The document discusses interest rates and how they work. It explains that interest rates are the price of borrowing money, and exist to compensate lenders for the risk that borrowers may default. The higher the risk of default, the higher the interest rate a lender will charge. It also discusses how interest rates affect borrowing and the economy - lower rates increase borrowing which can spur economic growth and inflation, so central banks may raise rates to slow growth when needed. Longer term loans have higher rates than short term due to inflation eroding loan values over time.