To decrease the amount required today to fund a $10,000 debt due two years from now, you could _____ on your savings.

A) Increase the rate of interest earned
B) Decrease the number of compounding periods per year
C) Earn simple interest rather than compound interest
D) Both decrease the rate of interest and the number of compounding periods per year
E) Either decrease the rate of interest or decrease the number of compounding periods per year

Compounding Periods

Compounding Periods refer to the frequency with which interest is added to the principal balance of an investment or loan, affecting the total interest earned or paid.

Compound Interest

Interest on a loan or deposit calculated based on both the initial principal and the accumulated interest from previous periods, leading to exponential growth.

Interest Rate

The percentage of a sum of money charged for its use, typically expressed on an annual basis, affecting loans, mortgages, savings, and investments.