Register
In 1 or 2 sentences, explain the effects of lower interest rates on consumption and investments.
158k views
1 vote
In 1 or 2 sentences, explain the effects of lower interest rates on consumption and investments.

User JensT
by
5.5k points

1 Answer

2 votes
Lower interest rates make it cheaper to borrow. This tends to encourage spending and investment. This leads to higher aggregate demand and economic growth. This increase in aggregate demand may also cause inflationary pressures.

I hope this helped!
User Tarsis Azevedo
by
6.3k points
Ask a Question
Welcome to QAmmunity.org, where you can ask questions and receive answers from other members of our community.

6.7m questions

8.9m answers

Other Questions

Which colonies were included in the middle colonies
North or south? during the civil war, the had the advantage of harboring 90 percent of the county's industries.
Laws of Conquest” in the new world were put in place by the _______. A. English B. Irish C. Spanish
What was nintendo befor it was a videogame compony
In what way did Andrew Jackson change the definition of democracy for the United States?
Link Copied!