Exploring the Impact of Interest Rates on Personal Finance

What is the fee called that is paid by a borrower to the lender?

• Dividend

• Profit

• Interest

• Capital

How much money did Ben borrow for his university education?

• $60,000

• $50,000

• $70,000

• $40,000

At what annual interest rate did the bank lend money to Ben?

• 6%

• 4%

• 5%

• 3%

What is the annual interest amount Ben has to pay to the bank?

• $3500

• $3000

• $2500

• $2000

Why does the bank pay Ben an interest rate for keeping his money in a savings account?

• To secure the bank's vault

• To increase bank's capital

• To use his money for investments

• To cover account fees

What is the principle amount that Ben initially saved in his bank account?

• $20,000

• $15,000

• $10,000

• $5,000

How much interest does Ben earn in the second year on his savings?

• $550

• $525

• $575

• $500

What is the total amount in Ben's account at the end of the third year?

• $12,025

• $12,550

• $11,025

• $11,550

What financial concept is described as earning 'interest on interest'?

• Annuity

• Compound interest

• Amortization

• Simple interest

According to personal finance experts, what is crucial for growing your retirement savings?

• Stock investments

• Real estate

• Compound interest

• Savings accounts