Listen to a Business English Dialogue about Annual percentage rate
Justin: Hi Taylor, have you ever heard of the term “annual percentage rate”?
Taylor: Hey Justin! Yes, the annual percentage rate, or APR, is the annual rate charged for borrowing or earned through an investment, expressed as a percentage.
Justin: That’s correct. It includes not only the interest rate but also any additional fees or charges associated with the loan or investment.
Taylor: Right. So, when comparing loans or investments, it’s essential to look at the APR to understand the total cost or return over a year.
Justin: Exactly. It gives borrowers and investors a standardized way to compare different financial products and determine which one offers the best value.
Taylor: Absolutely. For example, when applying for a loan, a lower APR indicates lower overall borrowing costs, while a higher APR on an investment could mean higher returns.
Justin: That’s a good point. The APR provides a clear picture of the true cost or return over time, helping individuals make informed financial decisions.
Taylor: Right. And it’s important to consider the APR along with other factors such as terms, conditions, and potential risks before making a decision.
Justin: Absolutely. By understanding the APR and its implications, individuals can make sound financial choices that align with their goals and circumstances.
Taylor: Agreed. Whether borrowing money or investing funds, being aware of the APR ensures transparency and helps avoid surprises down the line.
Justin: Definitely. So, next time you’re considering a loan or investment, don’t forget to check the APR to make sure you’re getting the best deal.
Taylor: Absolutely, Justin. It’s a crucial factor to consider for anyone looking to borrow or invest wisely.
