0 the interest percent that a bank or other financial company charges you when you borrow money, or the interest percent it pays you when you keep money in an account: --
1 the percentage amount that you pay for borrowing money, or get for lending money, for a period of time, usually a year: --
The real consumption interest rate is positive in the growth models that economists analyze.
Overall, the real interest rate has increased while real output has fallen.
Lenders and bor rowers cope with financial uncertainty by agreeing that the interest rate will be two percent more than the prevailing prime rate.
However, owners also provide labourers with credit, usually at a high interest rate, to enable them to buy essentials and support their families.
This interest rate does not reflect the rate-of-time preference.
In particular, the interest rate control rules may generate indeterminacy even in models with convex production technologies and separable utility functions.
It should also be pointed out that the sensitivity of the results with respect to the assumed real interest rate is rather low.
A similar term appears when one takes into account the fact that the nominal interest rate faces a lower bound at zero.
