A nation with a relatively low savings ratio will tend to have higher interest rates and more rapid inflation.

Question

Quizplus · Accepted Answer

A low savings ratio means there is less money available for lending, which can lead to higher interest rates as banks try to attract more savers. Additionally, lower savings can lead to higher spending, which can increase demand for goods and services, potentially leading to inflation if supply does not keep up with demand.

A Nation with a Relatively Low Savings Ratio Will Tend