What it is:
How it works/Example:
Let's assume you need $500,000 to buy a house. The "price" of borrowing that money is interest, and it is expressed as a percentage of the amount of money you obtain. The borrower pays the interest to the lender. The rate of interest reflects the time value of money, the borrower's credit risk, inflation rates and a variety of other market conditions.
Why it matters:
Interest rates are some of the most powerful and influential components of an economy. As a result,