Differences in Interest Rates

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Differences in Interest Rates
There is an element of monopolistic competition in the money market in as much as different borrow- .ers are charged different rates of interest. It may be noted. however, that pure interest tends to be the same. if calculated over the same period of time in the same money market. TIle actual differences that prevail are differences in gross interest. In other words. they are due to difference in the degree of risk involved and inconveniences suffered by the lenders.

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Differences in Interest Rates