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It means that they are getting less money for deferring expenditure and saving instead. However, it is not the low nominal interest rates which matter but what the "real" interest rates are. This is the difference between the nominal interest rate and the rate of inflation. An interest rate of 2% when inflation is 0% is good news for savers but an inflation rate even as high as 10% is bad news if inflation is higher than 10%.
What else can I help you with?
Is LIBOR normally higher or lower than the US prime interest rate?
It is normally higher than the US prime interest rate.
What is the formula to calculate monthly interest rate if the annual interest rate is known?
Annual Interest Rate divided by 12= Monthly Interest Rate
What is the Formula for simple interest rate?
The answer for rate in simple interest is =rate= simple interest\principle*time
Is there an interest rate symbol?
In macroeconomic equations that depend on the interest rate, a lower case, cursive "i" is usually used, although I've seen "r" as well. The exact notation will depend on the particular context in which you're looking to use it, though.
What is the corresponding componding?
Corresponding compounding is the interest rate on loan or the financial product restated from nominal interest rate as an interest rate with an annual compound interest.
Does refinancing result in a lower interest rate?
Yes, refinancing can result in a lower interest rate on a loan.
What occurs when a bonds stated interest rate is less than the market interest rate?
Since the current market interest rate is higher, it is more attractive to a new investor then the bond with a lower interest rate. Thus, the price of the lower interest rate bond has to decline to be competitive with new bonds in the market.
What occurs when a bond's stated interest rate is less than the market interest rate?
Since the current market interest rate is higher, it is more attractive to a new investor then the bond with a lower interest rate. Thus, the price of the lower interest rate bond has to decline to be competitive with new bonds in the market.
When is normal interest rate lower then effective interest?
Only on Tuesdays.
Is a higher or lower interest rate better for obtaining a loan?
A lower interest rate is better for obtaining a loan because it means you will pay less in interest over the life of the loan.
What does representative mean with regard to interest rates?
A representative interest rate is an interest rate that is exemplary or acrhetypical rate.
Does a higher down payment result in a lower interest rate?
In general, a higher down payment can result in a lower interest rate on a loan. This is because a larger down payment reduces the lender's risk, making them more likely to offer a lower interest rate.
How does obtaining a lower interest rate affect the amount you pay over time?
Obtaining a lower interest rate reduces the amount of money you pay in interest over time, resulting in lower overall costs for the loan or debt.
What does the nominal interest rate mean?
A nominal interest rate is an interest rate that does not factor in the rate on inflation. Nominal interest rate could also refer to an interest rate that does not adjust for the full effect of compounding.
What is sub-prime rate of interest?
It is one kind of interest rate lower than themarket interest rate for a target group. This type of interest rate was used in USA house mortgage loan to capture all the lower income people. This is the one significant cause of present economic crisis.
How can I refinance my loan without changing the interest rate?
To refinance a loan without changing the interest rate, you can focus on extending the loan term or negotiating for lower fees. This can help lower your monthly payments without affecting the interest rate.
What happens to the monthly payment and total payment for a loan with a lower annual interest rate?
If a loan has a lower annual interest rate, the monthly payment will be lower and the total payment over the life of the loan will also be lower.
