Responses
Both low and high interest rates yield low demand for credit because consumers see it as an indicator that the market is not in equilibrium. Demand is highest when rates are neither too high nor too low.
Both low and high interest rates yield low demand for credit because consumers see it as an indicator that the market is not in equilibrium. Demand is highest when rates are neither too high nor too low.
High interest rates yield low demand for credit.
High interest rates yield low demand for credit.
Low interest rates yield low demand for credit.
Low interest rates yield low demand for credit.
High interest rates yield high demand for credit.
High interest rates yield high demand for credit.
Low interest rates yield high demand for credit.
1 answer
The two correct answers that explain how the concept of demand affects the change in use of credit are:
These responses reflect the relationship between interest rates and consumer demand for credit: as interest rates rise, the cost of borrowing increases, leading to reduced demand for credit; conversely, lower interest rates decrease the cost of borrowing, leading to higher demand for credit.
