ECONOMICS (CBSE/UGC NET)

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 is the price you pay to borrow money or the cost you charge to lend money. Interest is most often reflected as an annual percentage of the amount of a loan. This percentage is known as the interest rate on the loan.

Detailed explanation-3: -Interest is the monetary charge for borrowing money-generally expressed as a percentage, such as an annual percentage rate (APR). Interest may be earned by lenders for the use of their funds or paid by borrowers for the use of those funds.

Detailed explanation-4: -Interest payments are the cost of borrowing money. The borrower makes these payments in addition to paying back the principal on a loan. If you lend money with interest, the interest payment is the amount you are paid over and above the principal amount you lent.

Detailed explanation-5: -Using credit means you borrow money to buy something. You borrow money (with your credit card or loan). You buy the thing you want. You pay back that loan later – with interest.