Question: If the default premium increases, what is the effect on the consumption and savings of an individual consumer? If the default premium increases, the individual

If the default premium increases, what is the effect on the consumption and savings of an individual consumer?

If the default premium increases, the individual consumer will face (CHOOSE BETWEEN the same OR a lower OR a higher)

loan interest rate which in turn means they will (CHOOSE BETWEEN: not change OR reduce OR increase) their consumption and (CHOOSE BETWEEN: reduce OR increase OR not change) their savings.

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