loan-interest

Vocabulary Word

Definition

Loan-interest is the money you have to pay on top of what you borrowed, like rent on the money. So, when you take a loan, you return the loan amount plus the interest.

Examples in Different Contexts

In auto loans, 'loan interest' is the fee charged by the lender for financing the purchase of a vehicle. An auto dealer might advise, 'Be sure to negotiate the loan interest rate, as even a small reduction can significantly lower your monthly payments.'

Practice Scenarios

Academics

Scenario:

Let's delve into the factors affecting the costs of borrowing. Understanding these factors can give us deep insights into economic behavior.

Response:

Indeed, the study of loan-interest could really improve our understanding of people's decisions to borrow or not.

Public-Policy

Scenario:

Our economy has been sluggish recently. Should we consider implementing policies to encourage borrowing and investment?

Response:

Yes, if we decrease the loan-interest rates, it might encourage businesses to borrow and invest more, thereby stimulating economic growth.