Asked by Sadie Clark on Jun 17, 2024
Verified
All else equal, more investment takes place at
A) higher market interest rates.
B) lower market interest rates.
C) higher nominal interest.
D) higher real interest rates.
Market Interest Rates
The rates at which borrowers and lenders conduct transactions in the open market, influenced by the supply and demand for credit, inflation, and central bank policies.
Nominal Interest
The interest rate on a loan or investment without adjusting for inflation.
Real Interest Rates
The interest rate adjusted for inflation, reflecting the true cost of borrowing or the true yield on savings.
- Decipher the linkage between interest rates and investment choices in businesses.
Verified Answer
KW
Katelyn WilliamsJun 18, 2024
Final Answer :
B
Explanation :
Lower market interest rates make borrowing cheaper, encouraging more investment by businesses and individuals.
Learning Objectives
- Decipher the linkage between interest rates and investment choices in businesses.