Okay, now what is interest?
A. Money the bank pays you to keep your money in your savings account.
B. Something you like to do after school.
C. The amount you pay the bank to open your savings account.
D. A business expense
A. Money the bank pays you to keep your money in your savings account.
I agree with the bot
Great! Yes, interest refers to the money that a bank pays to a customer in return for keeping their money in a savings account or investing in bonds or other financial products. It is usually a percentage of the total amount of money saved or invested over a specific period of time.
Interest refers to the amount of money that is either earned or paid when borrowing or lending money. It is typically expressed as a percentage of the initial amount borrowed or deposited (known as the principal).
To answer the question, we can eliminate options B and D as they do not relate to the financial concept of interest. Option C is also incorrect as opening a savings account generally does not involve paying the bank directly.
This leaves us with option A: interest is the money the bank pays you to keep your money in your savings account. When you deposit money into a savings account, the bank uses that money to lend to other individuals or businesses. In return for allowing the bank to use your money, they pay you interest, which serves as compensation for the use of your funds.