Cumulative interest is sometimes used as a measure of loan economics to determine which loan is most economical. However, cumulative interest alone does not account for other important factors such as initial loan costs (if those costs are paid out of pocket as opposed to being rolled into the loan's balance) and the time value of money (different rates of interest over the life of different loans can lead to savings early in the life of one loan that can offset higher interest rates later in the life of that loan).
Investment dictionary. Academic. 2012.
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cumulative interest — /ˌkju:mjυlətɪv ɪntrəst/ noun the interest which is added to the capital each year … Marketing dictionary in english
cumulative interest — /ˌkju:mjυlətɪv ɪntrəst/ noun the interest which is added to the capital each year … Dictionary of banking and finance
cumulative — [kyo͞o′myə lə tiv΄; ] occas. [, kyo͞o′myəlāt΄iv] adj. [see CUMULATE] 1. increasing in effect, size, quantity, etc. by successive additions; accumulated [cumulative interest] 2. taking successive additions into account [a cumulative average] 3.… … English World dictionary
Interest — For other uses, see Interest (disambiguation). Interest is a fee paid by a borrower of assets to the owner as a form of compensation for the use of the assets. It is most commonly the price paid for the use of borrowed money, or money earned… … Wikipedia
Cumulative frequency analysis — is the applcation of estimation theory to exceedance probability (or equivalently to its complement). The complement, the non exceedance probability concerns the frequency of occurrence of values of a phenomenon staying below a reference value.… … Wikipedia
Cumulative mismatch — The accumulated interest risk position/mismatch/gap at any given period of all interest risk positions/mismatches/gaps of future periods. The cumulative mismatch is calculated in the following reports: Forex risk analysis on fcy interest … … International financial encyclopaedia
Cumulative Return — The aggregate amount that an investment has gained or lost over time, independent of the period of time involved. Presented as a percentage, the cumulative return is the raw mathematical return of the following calculation: Investors are more… … Investment dictionary
cumulative — adj. 1 a increasing or increased in amount, force, etc., by successive additions (cumulative evidence). b formed by successive additions (learning is a cumulative process). 2 Stock Exch. (of shares) entitling holders to arrears of interest before … Useful english dictionary
interest — Synonyms and related words: absolute interest, absorb, absorption, accent, accrued dividends, accumulated dividends, acquisitiveness, activities, activity, advantage, advocacy, aegis, affair, affairs, affect, affect the interest, agacerie,… … Moby Thesaurus
Interest Cost — The cumulative sum of the amount of interest paid on a loan by a borrower. This amount should include any points paid to reduce the interest rate on a loan, since points are in effect pre paid interest. Additionally, any negative points or… … Investment dictionary