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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%.
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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
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.
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 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.
Personal loans should have a lower interest rate than student loans.?
Personal loans should have a lower interest rate than student loans.
What does representative mean with regard to interest rates?
A representative interest rate is an interest rate that is exemplary or acrhetypical rate.
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 interest rate affect the value of us dollar?
its actually the other way around. the value of the us dollar effects interest rates. the lower the us dollar is worth, the lower the interest rate
What is the prime interest rate?
The "Prime Interest Rate" is the interest rate used by banks to base all their loan interest rates (and sometimes other interest rates) on and is usually lower than the lowest rate charged on loans to customers with the best credit ratings.
What is a common interest rate with a 721 fico score?
The higher your FICO credit score, the lower your interest rate is commonly. If your score is at 721 then your interest rate may be approximately 3 percent.
What does effective interest rate mean?
An effective annual interest rate considers compounding. When the principle is compounded multiple times each year the interest rate increased to be more than the stated interest rate. The increased interest rate is the effective annual interest rate.
Is LIBOR normally higher or lower than the US prime interest rate?
It is normally higher than the US prime interest rate.
