5 Questions
Which of the following factors can cause the equilibrium interest rate to change over time?
Economic growth
What effect does increased government borrowing have on the equilibrium interest rate?
It increases the equilibrium interest rate
How does higher inflation impact the equilibrium interest rate?
It increases the equilibrium interest rate
What is another term for the equilibrium interest rate?
Natural rate of interest
How does a higher level of savings impact the equilibrium interest rate?
It decreases the equilibrium interest rate
Test your knowledge on the equilibrium interest rate and its factors affecting change over time. Explore how economic growth, business confidence, and monetary policy impact the natural rate of interest.
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