QUESTION IMAGE
Question
multiple-choice question
lowering the discount rate (interest rate) does what to
the economy?
speeds it up (expands)
slows it down (contracts)
rewatch
Brief Explanations
When central banks lower the discount rate, borrowing costs for commercial banks decrease. This leads banks to lend more to businesses and consumers at lower interest rates, increasing spending, investment, and overall economic activity, which expands the economy.
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Speeds it up (expands)