Other things the same, when the interest rate rises, people would want to lend Group of answer choices less, making the quantity

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AVprozaik [17]

1 year ago

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Other things the same, when the interest rate rises, people would want to lend Group of answer choices less, making the quantity

of loanable funds supplied decrease.

Business

1 answer:

Ahat [919] · Answer 1 · 2023-09-05T06:25:51+03:00

When there are a shortage of loanable funds and the interest rate rises, the quantity required exceeds the amount supplied, and the interest rate rises.

<h3>What happens if the interest rate in the economy rises?</h3>

Businesses and individuals will cut down on spending as interest rates rise. Earnings will suffer as a result, as will stock values. Consumers and corporations, on the other hand, will boost spending when interest rates have decreased dramatically, leading stock values to climb.

The availability of loanable funds indicates that as the interest rate rises, the amount of savings accessible will rise as well.

As a result, anytime interest rates rise, the economy will see a sudden and unexpected surge in borrowing costs.

Learn more about interest rates:

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