Economics 9708 · AS & A Level · Monetary policy

Monetary policy — practice question

Without any offsetting influences, in what way will a rise in interest rates influence share prices?

  • AIt will decrease share prices because financial investors will prefer to purchase bonds.
  • BIt will decrease share prices because inflationary pressure will increase.
  • CIt will increase share prices because company profits will rise.
  • DIt will increase share prices because saving will become less attractive.

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