Business High School
Answers
Answer 1
If interest rates increase in financial markets, the most likely circ*mstance among the given options is that individuals and businesses will be inclined to borrow less money, reducing the quantity demanded of money. Therefore, the correct answer is D. None of the Above.
When interest rates rise, borrowing becomes more expensive. As a result, individuals and businesses are discouraged from taking on additional debt or borrowing more money than initially planned. Higher interest rates increase the cost of borrowing, making it less attractive to undertake new projects, investments, or renovations that require financing.