Why do interest rates on loans tend to be lower in a weak economy than in a strong one?

Question

Mathematics

Flake

20 March, 22:02

Why do interest rates on loans tend to be lower in a weak economy than in a strong one?

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Answers (2)

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Adriel Oliver · Answer 1

Why do interest rates on loans tend to be lower in a weak economy than in a strong one?

The interest rates on loans tend to be lower in a weak economy than in a strong one because in a weak economy there is less demand for credit so the rates are lesser. In a stronger economy, the credit market demand is higher so as the demand increases the rate also increases.

Zhang · Answer 2

C

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