Final answer:
A decrease in prices related to oversupply occurs when the money supply grows too quickly, which can lead to different outcomes in the financial markets. A rise in the supply of money leads to lower interest rates, while an increase in demand for loans results in a higher quantity of loans made and received.
Step-by-step explanation:
There is a decrease in prices due to the oversupply of goods and services compared to the amount of money available to purchase them when the money supply grows too quickly. In the context of financial markets, which changes would lead to a decline in interest rates or an increase in the quantity of loans made and received?
Decline in Interest Rates:
A decline in interest rates occurs when there is a rise in the supply of money in the financial market. This is because more funds are available for borrowing, leading to increased competition among lenders, which results in lower interest rates.
Increase in Quantity of Loans:
An increase in the number of loans made and received happens with a rise in demand for loans, as this drives up the willingness of financial institutions to supply loans to meet the higher demand.