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Because of that, 200 at a given rate compounded quarterly rather than annually will grow to:
AA larger amount
BA smaller amount
CThe same amount
DA negative amount
Answer & Solution
Correct answer: A. A larger amount
1. Interest starts earning sooner.
2. That interest then earns as well.
3. The amount is larger.
_Source: OpenStax Principles of Finance 2e, Chapter 7, Time Value of Money I._
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