Explain How Changes in the Interest Rate Affect the Price

question 142

Essay

Explain how changes in the interest rate affect the price and quantity consumed of an exhaustible natural resource.Use a demand and supply graph to illustrate a rise in interest rates and a fall in interest rates.What does the demand curve for natural resources represent? What does the supply curve of natural resources represent?

---

Definitions:

Production Technology

The methods, equipment, and processes used to produce goods and services, impacting efficiency and output levels.

Economists

Professionals who study, develop, and apply theories and concepts from economics and write about economic policy.

Long Run

A period of time in economics during which all factors of production and costs are variable, allowing for full adjustment to changes in market conditions.

Hourly Wage Rate

The amount of money paid for each hour of work.