What Is Interest? Please Name Its Theories As Well?

Interest
Interest is the payment for services of capital goods. It is reward for parting with liquidity of funds. Interest is reward of use of capital. It is price paid for use of loneable funds. Those who borrow and use this fund have to apy a price which is interest.

Gross interest:
The total amount that burrower pay to the lender for the use of money is called gross interest. The whole amount is actually not the price for the use of burrower money.


Net interest:
It is price for use of capital. It may be in money, firm or physical for, for example machine. Capital is not a free good. The honor of the capital must get some return for its use, this is called net interest.

Theories of interest:

Thories of interest are the following

Abstinence or waiting theory of interest
Loanable fundtheory of interest
Keynes's liquidity prefrence thoery of intersest

Hope it was quite helpful to you. Good luck!