If the interest rate goes down, consumers have an incentive to save more because they earn more for loaning the bank their money.

Name: If the interest rate goes down, consumers have an incentive to save more because they earn more for loaning the bank their money.
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Question

Quizplus · Accepted Answer

If the interest rate goes down, it means consumers will earn less for loaning their money to the bank. Therefore, they have less incentive to save and may decide to spend their money instead.

If the Interest Rate Goes Down, Consumers Have an Incentive