interest

     

Interest is a fee, pai on borrowed capital. Assets lent include money, shares, consumer goods through hire purchase, major assets such as aircraft, and even entire factories in finance lease arrangements. The interest is calculated upon the value of the assets in the same manner as upon money. Interest can be thought of as "rent on money".

Trivia about interest

  • When you have an amortized mortgage, most of the early payments go to pay this part of the loan
  • An APR, or annual percentage rate, is a rate of this
  • On loans, it can be compound or simple
  • The simple type of this is computed on only the principal of a loan

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