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While the overwhelming majority of grants are awarded to non-business entities (e.g., state and local governments, schools and universities, nonprofit organizations, etc.), many cooperative agreements and contracts are awarded to for-profit businesses. Below is an overview of the key differences between grants, cooperative agreements and contracts. In addition to grants, the federal government also awards funds directly to business entities through cooperative agreements. Like grants, cooperative agreements are typically awarded through a competitive process.
January 21, 2011. When the government pays the principle and/or interest on a federal loan, on behalf of the borrower, the government refers to this as a subsidy. The loan is a subsidized loan. The government does not make such payments for unsubsidized loans. The most common type of government subsidized loans are student loans, through the U.S. Department of Education and the William D. Ford Federal Direct Loan Program.