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# Interest or Use of Money

## Definition

The payment made by borrowers to lenders for the use of capital, representing the profit that the borrower has an opportunity to make with the money. This is a derivative form of revenue ultimately derived from profits of stock.

## Source Chapter

Book I, Chapter 6

## Context

Discussed as one of the ways revenue can be derived from stock without directly employing it. Smith explains that interest represents the compensation paid to lenders for allowing borrowers to make profits with their capital.

## Economic Domain

Distribution

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