Higher interest rates typically _____ borrowing,ceteris paribus.
A) decrease
B) maintain
C) increase
D) indeterminately change

Name: Higher interest rates typically _____ borrowing,ceteris paribus. A) decrease B) maintain C) increase D) indeterminately change
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Question

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Higher interest rates increase the cost of borrowing, which makes it less attractive for people to borrow. As a result, demand for borrowing decreases and the quantity borrowed is likely to decrease, ceteris paribus.

Higher Interest Rates Typically _____ Borrowing,ceteris Paribus