BANKING GENERAL KNOWLEDGE
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Question
[CLICK ON ANY CHOICE TO KNOW THE RIGHT ANSWER]
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price paid for the use of borrowed money
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the amount of money borrowed
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the act of redirecting resources from being consumed today
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Detailed explanation-1: -Interest-The price that people pay to borrow money. When people make loan payments, interest is a part of the payment. Interest Rate-The cost of borrowing money expressed as a percentage of the amount borrowed (principal).
Detailed explanation-2: -Interest-The price of using someone else’s money; the price of borrowing money. Interest rate-The price paid for using someone else’s money, expressed as a percentage of the amount borrowed.
Detailed explanation-3: -The interest rate is the amount a lender charges a borrower and is a percentage of the principal-the amount loaned. The interest rate on a loan is typically noted on an annual basis known as the annual percentage rate (APR).
Detailed explanation-4: -When you take out a loan, lenders earn money by charging interest. In other words, interest is the price you pay for borrowing money from a lender. That means, when paying back the loan, you’ll pay the amount you borrowed plus an additional sum-which is the interest.