Forex Questions and Answers - FXAnswer

This is not to be confused with the Interest rate at which banks lend balances held at the Federal Reserve to other banks overnight which is sitting at .25%

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fuji022

1 year ago

The annual percentage rate at which the present value of a future pound, or other unit of account, is assumed to fall away through time. It is currently set at 3.5% pa in real terms. Mathematically, a discount rate is the opposite of a compound interest rate.

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certicex

1 year ago

The amount banks are charged in Interest if they need to borrow from Federal Reserve if they have not met the Reserve Requirements at the end of the business day. If the Discount Rate is lower than Fed Reserve there is an increase in Aggregate Demand.

by

certicex

1 year ago

The interest rate used in discounting future cash flows. Often determined using CAPM analysis, it intended to approximate the level of risk to the cash flows.

by

thegreeks

1 year ago

1. The interest rate that an eligible depository institution is charged to borrow short-term funds directly from a Federal Reserve Bank.

2. The interest rate used in determining the present value of future cash flows.

by

thegreeks

1 year ago

The rate used for adjusting the total present economic value of a resource, projected over time, that takes into account the declining value of money.

by

hanan

1 year ago

The rate used to calculate the present value of future cash flows.

by

hanan

1 year ago

The fee paid by merchants to credit card processors as a fee associated with accepting general use credit cards (like Visa, MasterCard, American Express and Discover Card). Typically this fee runs between 1% and 3%, depending on the nature of the transaction.

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hanan

1 year ago

shall mean that interest rate, expressed in terms of percentage per annum, which is utilized to adjust past or future financial or monetary payments to present value.*

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hanan

1 year ago

The annual rate at which the effect of future events are reduced so as to be comparable to the effect of present events. (IPCC

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hanan

1 year ago

The rate, per year, at which future values are diminished to make them comparable to values in the present. Can be either subjective (reflecting personal time preference) or objective (a market interest rate).

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hanan

1 year ago

# the rate of interest set by the Federal Reserve that member banks are charged when they borrow money through the Federal Reserve System
# interest on an annual basis deducted in advance on a loan

by

hanan

1 year ago

Discount rates can identify two different types of financial activity. One common use of the term has to do with the amount of interest that private banks pay to the United States Federal Reserve System in return for loan financing. The second application of the term has to do with the charge that merchants pay in order to process credit card payments as part of doing business.

by

Suneetha

1 year ago

The discount rate is the interest rate the Federal Reserve charges on loans it makes to banks and other financial institutions.

The discount rate becomes the base interest rate for most consumer borrowing as well. That's because a bank generally uses the discount rate as a benchmark for the interest it charges on the loans it makes.

For example, when the discount rate increases, the interest rate that lenders charge on home mortgages and other loans increases. And when the discount rate is lowered, the cost of consumer borrowing eventually decreases as well.

The term discount rate also applies to discounted instruments like US Treasury bills. In this case, the rate is used to identify the interest you will earn if you purchase at issue, hold the bill to maturity, and receive face value at maturity.

The interest is the difference between what you pay to purchase the bills and the amount you are repaid.

Dictionary of Financial Terms

by

fxpie

1 year ago

The discount rate is an interest rate a central bank charges depository institutions that borrow reserves from it

by

Steve

1 year ago