fixed-interest

Vocabulary Word

Definition

'Fixed-interest' refers to an agreement where the interest rate does not change over time. It's when you loan money, and the extra money you earn (interest) is the same no matter what happens.

Examples in Different Contexts

For loans, 'fixed interest' means the interest rate on the borrowed amount does not change during the life of the loan. A loan officer might explain, 'A fixed-interest loan offers peace of mind with predictable monthly payments.'

Practice Scenarios

Economics

Scenario:

The government is considering cutting interest rates to boost the economy. What impact could this have on average consumers?

Response:

A cut in fixed-interest rates can encourage people to borrow more, potentially driving up consumer spending.

Personal Finance

Scenario:

You want to optimize your profits from savings. Have you considered variability in interest rates from various financial institutions?

Response:

To maintain a steady growth of my savings, a fixed-interest savings account seems to be a good choice.