When the Interest Rate Increases,the

question 228

Multiple Choice

When the interest rate increases,the:

• A) amount of savings in banks decreases.
• B) amount of borrowing to finance investments decreases.
• C) cost of borrowing decreases.
• D) return on investments increases.

---

Definitions:

Attitudes

Psychological tendencies that are expressed by evaluating a particular entity with some degree of favor or disfavor.

Regulatory Focus Theory

A promotion focus causes people to be approach-oriented in constructing a sense of self; a prevention focus causes people to be more cautious and avoidant in constructing a sense of self.

Promotion Focus

A motivational orientation aimed at achieving positive outcomes and realizing aspirations or dreams.

Prevention Focus

A motivational orientation geared towards avoiding negative outcomes or maintaining safety and security.