The interest rate is the

Economics Nov 25, 2020

The interest rate is the... O a. Return earned for holding money. out of O b. Value that balances aggregate supply and demand. question O c. Price of borrowed money. O d. Dollar amount earned for lending money.

Expert Solution

The answer is (c)

When the money is borrowed from the lender, the total amount owed is called the principal and the price of the borrowed money is the interest rate which is charged on the borrowing. Thus, (c) is correct.

All other options are incorrect as they do not represent the definition of interest rate.

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