At an interest rate of 8%,borrowers' demand is $30 billion.At 4%,borrowers would want to borrow:
A) $20 billion.
B) $25 billion.
C) $30 billion.
D) $45 billion

Question

Quizplus · Accepted Answer

Generally, as interest rates decrease, the quantity of loans demanded increases because it becomes cheaper to borrow money. Therefore, at a lower interest rate of 4%, borrowers would want to borrow more than at 8%, making $45 billion the correct choice.

At an Interest Rate of 8%,borrowers' Demand Is $30 Billion