Question

How does the interest rate and consumer expectations affect the
business cyde?

Answer 1

the lower interest rates encourage companies to the expansion.This is due to the fact that the companies are able to borrow money at a lower interest rates.This provides an opportunity to borrow money necessary to expand the business.The inflation and interest rate expectations of consumers and firms are important variables determining bond prices.They are also key in determining the level of consumption, private investment, and debt levels in the economy.

Step-by-step explanation:

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