Answered

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8. As interest rates rise,
O
bonds and savings accounts become less attractive for investment
О
it becomes less expensive to hold money as cash
O
firms will generally spend their wealth
O
it becomes more expensive to hold money as cash

Sagot :

GinnyAnswer

Final answer:

Rising interest rates increase the cost of holding money as cash, leading to a shift in investments.


Explanation:

As interest rates rise, it becomes more expensive to hold money as cash. When interest rates increase, the opportunity cost of holding money or investing in low-yielding assets like bonds rises. Therefore, people tend to hold less money and shift their investments towards higher-yielding alternatives.


Learn more about Impact of interest rates on investment decisions here:

https://brainly.com/question/49028383


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