What is Interest Rate? Definition, Types & History


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question 1 of 3

Which of the following is NOT one of the components of interest rates discussed in this lesson?

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1. What impact can have a credit score have on interest rates?

2. Which of the following is the BEST definition of interest rates, according to this article?

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About This Quiz & Worksheet

Interest rates reflect the general condition of the economy and have a significant impact on whether businesses and industries will expand, as well as whether sales and consumer consumption will increase or decrease. This quiz/worksheet combo will help you understand the history of interest rates, how they work and the factors used to set them.

Quiz & Worksheet Goals

In these assessments, you'll be tested on:

  • The definition of interest rates
  • The effect of time on interest rates
  • Types of benchmark rates
  • The evolution of interest rates
  • The relationship between credit scores and interest rates

Skills Practiced

This quiz and worksheet allows you to test the following skills:

  • Knowledge application - use your understanding of interest rates to explain their effect on the economy
  • Defining key concepts - ensure you can accurately define key terms such as opportunity cost and inflation
  • Distinguishing differences - compare and contrast benchmark interest rates and common interest rates
  • Making connections - examine the role of interest rates in monetary policy

Additional Learning

To learn more, review the accompanying lesson, What is an interest rate? Definition, Types & History. This lesson covers the following objectives:

  • Understand how the use and calculation of interest rates changed over time
  • Explain the impact benchmark rates have on mortgages and car loans
  • Describe the role of the Federal Reserve Bank in setting interest rates
  • List the factors that can affect the interest rates on small loans
Final Exam
Corporate Finance: Help & Review
This course currently has no final exam ready
Chapter Exam
Financial Accounting: Help & Review
Status: Not Started