What is the meaning of Risk-Free Interest Rate?

Describes return available to an investor in a security somehow guaranteed to produce that return. The' Risk-Free Interest Rate' compensataes the investor for the temporary sacrifice of consumption.

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APABarry Goldsmith. (2010). risk-free interest rate. Retrieved September 26, 2026, from http://smartdefine.org/risk-free_interest_rate/definitions/1162665
ChicagoBarry Goldsmith. 2010. "risk-free interest rate" http://smartdefine.org/risk-free_interest_rate/definitions/1162665 (accessed September 26, 2026).
HarvardBarry Goldsmith 2010, risk-free interest rate, Smart Define, viewed 26 September, 2026, <http://smartdefine.org/risk-free_interest_rate/definitions/1162665>.
MLABarry Goldsmith. "risk-free interest rate" 21 October 2010. Web. 26 September 2026. <http://smartdefine.org/risk-free_interest_rate/definitions/1162665>