ECS 3701 ASSIGNMENT 1
Johns Hopkins University
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ECS 3701 ASSIGNMENT 1
- Exam (elaborations) • 12 pages • 2021
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1.01 When interest rates
[1] decrease, businesses will decrease their investment spending.
[2] increase, savers are worse off.
[3] increase, borrowers benefit.
[4] decrease, the cost of financing a house is lower.
Due to a decrease in interest rates, consumers would be more likely to purchase a
house or a car because the cost of financing their purchase is lower (as higher
rates could deter one from borrowing to buy a house or car).
On the contrary, higher interest rates could encourage ...
Exam (elaborations)
ECS 3701 ASSIGNMENT 1
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1.01 When interest rates [1] decrease, businesses will decrease their investment spending. [2] increase, savers are worse off. [3] increase, borrowers benefit. [4] decrease, the cost of financing a house is lower. Due to a decrease in interest rates, consumers would be more likely to purchase a house or a car because the cost of financing their purchase is lower (as higher rates could deter one from borrowing to buy a house or car). On the contrary, higher interest rates could encourage ...
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