Interest Rates Flashcards
1
Q
What can Low interest Rate lead to?
A
increased Spending
2
Q
When happens when rates are low?
A
Firms and consumers borrow more and save less.
3
Q
What happens when consumers have more money to spend?
A
demand for goods & services goes up. This means that firms are likely to make more profit and may need increase output.
4
Q
What does High Increase Rate lead to?
A
Decreased Spendings
