Essentials Of Investments
Essentials Of Investments
11th Edition
ISBN: 9781260013924
Author: Bodie, Zvi, Kane, Alex, MARCUS, Alan J.
Publisher: Mcgraw-hill Education,
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Define compounding

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A compounding is the interest charged on interest. When any investment is made for certain years, the value of these investment are calculated at every compounding periods.

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The compounding is basically considered the time value of money. The present value and the future value of the investment can be calculated using the compounding effects.  

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