Low interest rates generally encourage business investment. When interest rates are low, the cost of borrowing decreases, making it cheaper for businesses to take out loans for expansion, equipment purchases, and other investments. This can lead to increased business activity and economic growth. Therefore, the correct answer is: They encourage it.
What effect do low interest rates have on business investment?
They encourage it.
They slow it down.
They generally stop it completely.
They do not have much effect on essential investment.
1 answer