discount rate
6
4.9
- noun
- /ˈdɪsˌkaʊnt reɪt/
- Specialized
:
tasa de descuento
- As noted, the Office of Management and Budget suggests a 7% discount rate, departing from a 10% rate in the 1980s.
- real discount rate
- 10% discount rate
- lower discount rates
Examples
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The conclusions are not much affected by the choice of discount rate.
Academic text (2001) -
In present value terms, the system is regressive when a 10% real discount rate is employed.
Academic text (1992) -
Suppose that the appropriate social discount rate is 10 percent.
Academic text (1998) -
However, it is not obvious that this is the correct discount rate to use for these types of projects.
Academic text (1992) -
You may disagree about what the right discount rate should be, but people are weighing these things.
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Overall, therefore, the case for the early RE policy is not crucially dependent on the discount rate.
Academic text (2001) -
Typically, societal discount rates between three and five percent are used in benefit-cost analyses of water-conservation measures.
Academic text (1992) -
The Federal Reserve announced it would decrease the discount rate to encourage banks to borrow more funds.
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After the economic crisis, the discount rate was lowered to stimulate lending among commercial banks.
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The bank's decision to raise the discount rate led to higher borrowing costs for financial institutions.
Synonyms
415
2.3
The extra money you pay when you borrow or receive when you save each year
5
3.2
Percent a bank charges for borrowing money each year
1
4.6
The interest rate that a country's central bank sets for loans to commercial banks
A key interest rate set by the Bank of England that other loan rates follow
How High
Surface Forms
Morphology
The compound combines 'discount' (a deduction or interest taken in advance) with 'rate' (a percentage or charge), so its meaning as the percentage or rate associated with a discount is directly derivable from the parts. Although the full technical banking details may be specialized, the basic concept — a rate that expresses a discount — is compositionally transparent and cross-linguistically common, so a B1 learner who knows both words would likely understand it.
Etymology
Discount rate paints a simple picture: discount means taking a little off a price, and rate means the price level. So when a central bank sets a discount rate, it is the price (the interest) it charges other banks to borrow money.