Question

How will a slow and weak economy change the demand for money, interest rates, and investment in an economy?

A.) A
B.) B
C.) C
D.) D

Answer 1

E is the correct option.

Step-by-step explanation:

As given in the table, it is obvious that in Inflation, the need for money increases as more money is needed to buy the same products.

The interest rates also increase as the banks are less sure of the value of money and because the value of the money has decreased, the interest rates have to go u to cover for it.

Because the value of money decreases, the investors are vary of investing theirs in fear of more devaluation.