Is there a downside to low interest rates? Ever since the 2008 Financial Crisis, the central banks world-wide have been keeping interest rates very low. In this lecture, you will learn how interest rates were identified as being one of the factors that may change the AD curve. In a previous lecture, you learned lowering the interest rates by the Fed is one of the tools that may be used to stimulate the economy. Some economists have stated that interest rates are too low and have been so for far too long. As with many issues in economics there are two sides. For your initial post, answer the following and include at least one scholarly reference supporting your problems:

• Describe two potential problems with low interest rates and relate the problems to economic growth, conflict with Fiscal Policy, and/or economic recovery.

Answer rating: 100% (QA)

Two potential problems with low interest rates are Savings and Investment Challenges Low in... View the full answer