Falling interest rates mean increased business investment and a resulting increase in aggregate demand for real GDP in the aggregate economy.

Question

Quizplus · Accepted Answer

Falling interest rates make it cheaper for businesses to borrow money, which can then be used to invest in new projects and expand operations. This increase in investment leads to an increase in aggregate demand for goods and services, which can result in an increase in real GDP.

Falling Interest Rates Mean Increased Business Investment and a Resulting