Question

When dealing with a loan, who benefits from compounding interest more frequently, and why?
a.
The lender benefits, because the interest compounded increases further interest calculations.
b.
The lender benefits, because more compounds means that the borrower must pay more frequently.
c.
The borrower benefits, because the interest gained can be used to pay off the loan.
d.
The borrower benefits, because each increment of interest will be smaller.

Answer 1

right answer is a.  

The lender benefits, because the interest compounded increases further interest calculations.

Answer 2

Answer:

a.

The lender benefits, because the interest compounded increases further interest calculations.

Step-by-step explanation:

When dealing with a loan , the lender benefits from compounding interest more frequently. This is because the amount of interest compounded on the principle increases and this new amount further increases due to interest calculations.