Understanding the Role of Central Banks in the Economy
You take out a short term personal loan of ₹50,000 for one year at an interest rate of 12%. By the end of the year, you’ll pay back ₹56,000, including the ₹6,000 interest. Now, what if interest rates were 8% instead? You’d save ₹2,000 in interest. This is where central banks step in—they decide these…