Question

Future value calculations are also referred to as:

A. discounting.
B. add-on interest.
C. compounding.
D. simple interest.

Answer 1

The correct answer is C. Compounding

Answer 2

C. compounding.

Step-by-step explanation:

Future value, or compounding refers to the exponential increase on value of a specific asset in a future amount of time thanks to its ability to generate earnings through investments and interests, and then generate more earnings through those initial earnings. Therefor, future value calculations are also referred to as compounding.