In this assignment describe and explain the differences between the three differ
ID: 2652123 • Letter: I
Question
In this assignment describe and explain the differences between the three different types of interest rates one from the Federal Reserve, one from a bank for business, and one from any financial institution for a consumer loan.
For the business and consumer interest rates compare to other financial institutions. Look at what are the guidelines for the loan (upfront fees, credit rating, etc.).
Do not copy and paste from your source (loss of 10 points).
What is the LIBOR and how do I find that information?
State the current interest rate, date on which you did your research, and comparsions of different organizations, with the exception of the Federal Reserve.
Explanation / Answer
usually the interst for business loans are much lesser than consumer loans. the reason will be many, about the credit worthyness, large quantity of amount, longer period to repay and so on. comparatively consumer loans are higher cost than business loans, any financial institue follows this concept only. credit rating plays a major role in the process of lending a loan to customer, based on the credit rating bankers will offer loan at less interest rate.
LIBOR: London Inter Bank Offer Rate: is the bench mark rate that some of the world's leading bankers charge on short term lendings and short term loans. IntercontinentalExchange London Interbank Offered Rate and serves as the first step to calculating interest rates on various loans throughout the world. yoy can visit the webpage of LIBOR to get the complete information.
interest rates are differ to one banker to another and they keep on changes based on the fed reserve decisions. usually Fed reserve give the interest price band only, later the financial institutuion can decide the rate of interest that charges or offers.