If there is a large supply of savings relative to the demand for short-term funds, the interest rate for that country will be relatively low.

Question

Quizplus · Accepted Answer

When there is a large supply of savings relative to the demand for short-term funds, it means that there is an abundance of money available to lend. This increased supply of money can lead to competition among lenders, which can drive down interest rates for borrowers. Therefore, in this scenario, the interest rate for that country will be relatively low.

If There Is a Large Supply of Savings Relative to the Demand