GyanGramQuestion
If the interest rate is decreased in an economy, it will
PRELIMS 2014 · INDIAN ECONOMY
If the interest rate is decreased in an economy, it will
Attempt this previous-year question. The correct option stays hidden until you choose.
Pick an option to check yourself.
• Correct Answer: C
• Lower interest rates reduce the cost of borrowing for firms, incentivizing investment in capital, equipment, and expansion.
• Cheaper credit raises expected returns on investment projects.
• A, B, D are wrong: lower rates boost consumption, may reduce savings, and do not directly increase tax collection.
Keep going in GyanGram.
Attempt Prelims MCQs or open Mains questions by paper — then continue the same bank inside the app with visual decks.