Meaning
Interest Rate is a crucial factor in finance, impacting both borrowers and lenders significantly.Definition
It’s the cost of borrowing money or the reward for lending it, expressed as a percentage of the principal amount over a period.How It Works
When you borrow, you pay this percentage back to the lender in addition to the original sum. When you lend, you earn it. It influences loan repayments and investment returns.Key Types
Common types include Fixed Interest Rates, which remain constant, and Variable Interest Rates, which can change over time.Author
