Asked by Taylor Ingram on May 20, 2024
Verified
The higher the interest rates
A) the more value individuals place on future dollars
B) the more value individuals place on current dollars
C) individuals do not place any importance on either current or future dollars
D) does not affect the investment strategy
Interest Rates
The cost of borrowing money or the return for investing money, usually expressed as a percentage of the principal amount.
Future Dollars
Currency value projected at a future date, often used in the context of inflation or investment growth.
- Understand how interest rates influence investment decision-making.
Verified Answer
AB
Amara BarksMay 24, 2024
Final Answer :
B
Explanation :
Higher interest rates make borrowing more expensive and saving more rewarding, leading individuals to value current dollars more because they can earn more interest on savings or because borrowing costs are higher.
Learning Objectives
- Understand how interest rates influence investment decision-making.
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