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4 / 1013 |
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Interest is the fee paid for borrowing money. Most individuals or business owners pay simple interest on a short-term loan, which is usually a loan of up to 1 year. The amount of interest charged by a bank depends on three factors:
1. The amount borrowed is called the principal.
2. The length of time the money is borrowed...
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The length of time the money is borrowed.
3. The rate of interest charged.
The interest rate assigned to a loan may vary widely according to such factors as the prime rate set by the bank, the credit rating of the borrower, and general economic conditions. The prime rate is the interest rate assigned to the institution's best customers...
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