Illustrate diffrent types of interest rates, Macroeconomics

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Q. Illustrate diffrent types of interest rates?

There are many other interest rates in a society. For instance, you will earn interest when you deposit money in a bank account and you would pay interest when you borrow money. These interest rates will rely on the specifics of the deposit and perceived risk when you borrow money. Though, all interest rates are correlated with the market interest rates. When you borrow money, you characteristically pay a higher interest rate compared to government bonds, and when you lend money, you would receive a lower rate.


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