Economics 2281 · O Level · Monetary policy

Monetary policy — practice question

Why might an increase in the interest rate cause inflation to fall?

  • AConsumers will be more willing to save when interest rates are high.
  • BConsumers will be more willing to spend when interest rates are high.
  • CProducers will be more willing to borrow from banks when interest rates are high.
  • DProducers will be more willing to invest when interest rates are high.

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