As interest rates decrease, the
A)cost of current relative to future consumption increases.
B)cost of current relative to future consumption decreases.
C)cost of current consumption relative to future consumption remains the same.
D)desire of many individuals to save increases.

Question

Quizplus · Accepted Answer

When interest rates decrease, the cost of borrowing money becomes cheaper, making it less expensive for individuals to consume now rather than in the future. This effectively decreases the cost of current consumption relative to future consumption.

As Interest Rates Decrease, the