If the domino effect occurs as a result of changes in the money supply, what will most likely happen as an immediate result of banks having more money to lend?

Borrowing will decrease.

Interest rates will decrease.

Investing will decrease.

Inflation will decrease.

B: Interest rates will decrease.

The correct option is B (Interest rates will decrease)

Explanation:

In the event that the domino impact happens because of changes in cash supply, the bank will prompt have more cash to loan causing;

• Interest rates to lessen

• Investments rates to diminish

The national banks apply diverse strategies to increment or decrease the assets in the keeping money framework. This is called financial arrangement. The FED impacts the supply of cash by changing store prerequisites.

They bring down the hold necessities to almost certainly credit more cash which thusly expands in general cash supply in the economy of the nation. Through raising the bank's stores necessity, the Fed can bring down the span of cash providing in the economy.