Interest rates

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The percentage of interest charged on borrowed money or paid on invested funds, which is a crucial tool used by central banks to control the economy's money supply and inflation.

Simple vs Compound Interest: Understanding the difference between simple and compound interest calculations is critical to comprehending interest rates.
Time Value of Money: A concept that describes how the value of money changes over time and why it is important when calculating interest rates.
Nominal vs Real Interest Rates: Understanding nominal and real interest rates and how they differ is crucial to understanding how interest rates work in the real world.
Inflation: The rate at which the general price level of goods and services in an economy is increasing. Inflation is a critical factor that affects interest rates.
Central Bank: The role of the central bank in setting interest rates and its impact on the economy.
Monetary Policy: The policies and tools used by the central bank to control the money supply and influence interest rates.
Federal Reserve Rates: Understanding the federal reserve rate and how it affects interest rates.
Bond Markets: How bond markets work, and the relationship between bond prices and interest rates.
Yield Curve: A graph showing the relationship between bond yields and maturities which can give insights into future interest rate trends.
Discount Rate: The rate at which financial institutions can borrow money from the central bank, and the impact it has on the economy and interest rates.
Interest Rate Parity: A theory that suggests interest rate differentials between countries should equal the expected gain or loss due to exchange rate changes.
Taylor rule: The mathematical formula used to determine the optimal level for the federal funds rate based on economic conditions such as inflation and output.
Liquidity Preference Theory: A theory that explains how investors balance the desire for returns with the need for money to remain liquid.
Quantity Theory of Money: The relationship between the money supply, prices of goods and services, and the velocity of money that can impact interest rates.
Fisher Effect: An economic theory that suggests that the real interest rate is equal to the nominal interest rate minus the expected inflation rate.
Public Debt: How government borrowing can affect interest rates.
Money Multiplier: The process by which banks create money as a result of the loans they make, which affects the money supply and ultimately interest rates.
Fiscal Policy: The role of government spending and taxation in the economy, and how it can affect interest rates.
Nominal interest rate: The rate at which money is borrowed or lent, expressed as a percentage without accounting for inflation. It is also known as the stated interest rate.
Real interest rate: The rate at which money is borrowed or lent, adjusted for inflation to reflect the true purchasing power of money.
Effective interest rate: The actual rate at which money is borrowed or lent after accounting for compounding and fees.
Simple interest rate: The rate at which money is borrowed or lent without compounding.
Discount rate: The rate at which central banks lend money to commercial banks, which is used to regulate monetary policy.
Prime rate: The rate at which banks lend money to their most credit-worthy customers.
LIBOR (London Interbank Offered Rate): The rate at which banks borrow from each other in the London interbank market.
Federal funds rate: The rate at which banks lend money to each other overnight to meet reserve requirements set by the Federal Reserve.
Treasury yield: The yield on U.S. government bonds, which is used as a benchmark for other interest rates.
Mortgage rates: The rate at which banks lend money to finance a home purchase.
Credit card rates: The rate at which banks charge interest on unpaid credit card balances.
Car loan rates: The rate at which banks lend money to finance a vehicle purchase.
Personal loan rates: The rate at which banks lend money for personal use, such as debt consolidation or a major purchase.