Term: Cost of Money
The term "cost of money" refers to the expenses associated with borrowing or using money, including interest rates, fees, and other charges. It encompasses the financial burden or price one must pay to obtain funds or capital for various purposes.
Examples:
- The cost of money for this loan is quite high, as the interest rate is steep.
- Businesses need to carefully consider the cost of money before taking on debt to expand their operations.
- Investors should always factor in the cost of money when evaluating potential returns.
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