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How to calculate monthly interest on home loan with fixed interest?

Answer»

For EXAMPLE, a customer would usually pay interest to borrow from a bank, so they pay the bank an amount which is more than the amount they borrowed; or a customer may earn interest on their savings, and so they may withdraw more than they originally deposited. In the case of savings, the customer is the lender, and the bank plays the role of the borrower.
Interest DIFFERS from profit, in that interest is received by a lender, whereas profit is received by the owner of an asset, investmentor enterprise. (Interest may be part or the whole of the profit on an investment, but the two concepts are distinct from each other from an accounting perspective.)
The rate of interest is EQUAL to the interest amount paid or received over a particular period DIVIDED by the principal SUM borrowed or lent (usually expressed as a percentage).



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