contestada

As interest rates decline, stocks become a __________ attractive investment relative to bonds, and this causes the demand for stocks and their prices to __________.

Respuesta :

Answer:

A. More; rise

Explanation:

When interest rate reduces or declines, stock becomes are more attractive business than bonds because stocks generally offer a potentially higher returns than bonds. But it should be noted that it also comes with higher risk. When interest rates falls, consumers and businesses will increase spending causing stock prices to rise. Hence, why stock becomes more attractive and demand for it rises.