Historically, many cultural groups have outlawed usury, or the practice of levying interest on loans. Some...

Historically, many cultural groups have outlawed usury, or the practice of levying interest on loans. Some groups oppose usury because it exacerbates problems of income inequality (as wealthier individuals can afford to lend to poorer individuals), while others claim investment and loans should be made charitably. Evaluate these arguments against usury based on your knowledge of present value. Do such prohibitions make sense?

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Expert Solution

Usury had many of the arguments in negative sense or against 28 right from the past and it has to be observed that lending money at unreasonably high interest rate is something that can trigger inequality on the whole. however if the argument is against lending money with interest rates it has to be noticed that the time value of money should be taken into consideration at the present scenario with which the value of money actually gets to increase and also in the current market scenario where everything is based on supply and demand the demand for loan is high then automatically it will adjust accordingly with the amount of interest rate with which it has to be lantern and this can serve as a mode of maintaining equilibrium in the market and keeping the economy stable and therefore search for HIV patients of interest rates make more sense as it can t certain fluctuations in a stable economy however landing at unreasonably high interest rate is something that the government should control and the rest should be left to the market.

Rahul Sunny answered 1 year ago

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