Increased consumer saving and investing is likely to be accompanied by

Question

Quizplus · Accepted Answer

When consumers save and invest more, there is more money available for banks to lend out, which increases the supply of funds available for borrowing. This can lead to lower interest rates as banks compete to lend out these funds. Lower interest rates also make it cheaper for businesses to borrow money for investment, which can lead to increased production efficiency and lower production costs. Higher inflation is less likely to occur because there is less spending in the economy, therefore less demand for goods and services. Lower union wages are not necessarily a direct result of increased consumer savings and investing.

Increased Consumer Saving and Investing Is Likely to Be Accompanied