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A compensating balance maintained for a loan increases the actual interest rate on a loan.
Interest
The cost paid by a borrower for the use of borrowed money, or the income earned by an investor on their investment.
Inventory
The total amount of goods and materials held in stock by a business, intended for sale or production purposes.
Opportunity Cost
The cost of the next best alternative foregone as the result of making a decision.
Investment Project
A project undertaken by individuals, firms, or governments involving the allocation of resources to create future benefits, such as income or profit.
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