ECONOMICS (CBSE/UGC NET)

Detailed explanation-1: -Interest is essentially a charge to the borrower for the use of an asset. Assets borrowed can include cash, consumer goods, vehicles, and property. Because of this, an interest rate can be thought of as the “cost of money”-higher interest rates make borrowing the same amount of money more expensive.

Detailed explanation-2: -Interest is the amount of money a financial institution charges for letting you use its money. The rate of interest can be either fixed or variable. Fixed rate means the interest rate stays the same throughout the term of the loan. Variable rate means the interest rate might change during the loan term.

Detailed explanation-3: -The interest rate is the amount lenders charge borrowers and is a percentage of the principal. It is also the amount earned from deposit accounts.

Detailed explanation-4: -Credit card purchase interest is what a credit card issuer charges when you don’t pay off your statement balance in full by the end of the billing cycle in which the purchases were made. The purchase interest charge is based on your credit card’s annual percentage rate (APR) and the total balance on the card.