For example, the annual profit 1%, that is, 1%, and the annual loan income 100 yuan; Monthly income 1%, that is, 0. 1%, January lending income 10 yuan; Daily interest (interest rate) 1% 0.0 1% lending 1. 1 daily income 1 yuan. The common unit of private lending is "Li", which means several thousandths. For example, 3% interest is 0.3%, and interest is calculated by time. Before calculation, it is necessary to distinguish whether it is day, month or year.
2% interest is 0.2% interest.
Expected annualized interest rate = principal *0.2%*2=0.4%.
Annual interest rate = principal *0.4%* 1
If the monthly interest rate is 2.3%, that is, the monthly interest rate is 2.3% and the semi-annual interest rate is 2.3*6= 13.8%, this is not a rolling interest. The interest of 25,000 yuan for half a year is 2.5 * 0. 138 = 0.3450 yuan.
Factors that generate interest:
1. Delayed consumption
When lenders borrow money, they delay the consumption of consumer goods. According to the principle of time preference, consumers will prefer current goods to future goods, so there will be positive interest rates in the free market.
2. Expected inflation
Most economies will experience inflation, which represents a certain amount of money, and fewer goods can be purchased in the future than now. Therefore, the borrower should compensate the lender for the losses during this period.
3. Alternative investment
Lenders can choose to invest their money in other investments. Due to the opportunity cost, the lender borrows money, which is equivalent to giving up the possible return on other investments. Borrowers need to compete with other investments for the fund.
4. Investment risk
Borrowers face the risk of bankruptcy, absconding or non-repayment at any time, and lenders need to charge extra fees to ensure that they can still get compensation under these circumstances.
5. Mobility preference
People prefer that their funds or resources can be traded immediately at any time, rather than getting their time or money back. Interest is also a kind of compensation.