Current Affairs · Monetary Policy
If the central bank increases key policy interest rates, what is the most direct and likely impact on businesses?
Verified Solution4 OptionsUpdated: October 2026👁️1 View
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- 1A sharp drop in the national exchange rate
- 2Lower consumer demand and reduced business investment due to expensive credit✓
- 3Significant increase in business investment spending
- 4Reduced borrowing costs and higher profit margins
Correct answer
Lower consumer demand and reduced business investment due to expensive credit
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