QUESTION 9 If other things remain the same the more producti

QUESTION 9 If other things remain the same, the more production opportunities an economy has, the lower the interest would be. O True False

Solution

This Answer of above Question is True.

Because if the more production oppurtunity with in the economy that means more employment. If all the persons getting salary by this oppourtunity then the persons have no need to take loan from financial institutions and Banks.

So,

By which if loan are not taken by many peoples then the rate of interest are lower in this economy.

Here More production oppourtunity defines more employment in the economy by which most of the people are getting paid and covers all her needs by this paid. So interest are no need for that type of people who geeting paid from their employment. If people are less in taking the loan then this is direct effected the interest rate which are lower.