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O-LevelEconomicsGovernment and the macroeconomy2281/12 · Oct/Nov 2022 · Q131 Mark

The central bank of a country decreases interest rates to help the economy out of a recession. How is this decrease in interest rates most likely to affect the levels of saving in and borrowing from the country's commercial banks?

Adecreases decreases
Bdecreases increases
Cincreases increases
Dincreases decreases

✓ Correct answer

B: decreases increases

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About this question

Topic
Government and the macroeconomy, O-Level Economics (syllabus 2281). Multiple choice, 1 mark.
Source
O-Level Economics, Oct/Nov 2022 Paper 1 Variant 2, question 13.

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