Interest Rate and Money Supply?

2011-04-25 5:14 pm
Is it true that when money supply is plenty, interest rate will go down it's easier to borrow $?

回答 (2)

2011-04-25 5:19 pm
✔ 最佳答案
Yes, supply and demand has an affect on interest rates. When money is *plentiful* banks are willing to loan it at more attractive rates to get it working for them. It also means more banks have money to loan. This increased competition also keeps rates low.
2016-12-16 10:53 pm
often there is an inverse relationship. it truly is, whilst the availability of money will develop, the charges of activity decrease so the banks can or are greater prepared to own loan money out to debtors. If the availability is tight, the value to borrow is going up. It an analogous with the availability of almost any commodity.


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