Discount Rate

Degree to which future dollars are discounted relative to current dollars. Economic analysis generally assumes that a given unit of benefit or cost matters more if it is experienced now that if it occurs in the future. The degree to which the importance that is attached to gains and losses in the future is known as discounted. The present is more important due to impatience, uncertainty, and the productivity of capital The interest a private bank pays for a loan from the U.S. Federal Reserve System.