A savings account that compounds interest daily will earn a higher return than a savings account that pays simple interest daily. True or false

True

Step-by-step explanation:

The simple interest daily pay doesn't grow with time, while your daily compound interest, albeit small, will grow with time and eventually yield a higher return.

For example if you deposit $1000 into your saving account and the simple interest gains you $1 a day, after 100 days you would have

$1000 + $1 * 100 = $1100

However, with compound interest at 0.1% rate daily. After 100 days you would have

$1000 * 1.001^100 = $1105.12

So compound interest gives higher return