Home work question: how do interest rates affect our everyday lives(doesnt have to be long please help?

Answer 1

If the interest rates are low more people are buying houses.
If the interest rates are high you are earning more money towards you Cd's, savings accounts.

Answer 2

When interest rates are high, money flows for negative use and operates against the economy and the welfare of people.

People stop investing in things for the future, homeowners and other property owners with variable rate mortgages are forced into bankruptcy, purchases of higher priced products slow down or halt. In the end, this affects manufacturing plants - they close down and lay off people.

With more people now unemployed, the unemployment rate jumps, the amount of money paid out into the social welfare system jumps, and there are fewer jobs for people to return to.

Depression sets in, the suicide rate jumps, and violence begins to rise on the streets with people now desperate for money and food.

The attitudes of law enforcement changes, they stop being polite to people and instead of serving people, serve the world of law instead - which is bad for the people. The cops now become part of the problem. Corruption become rampant at all levels where people have power. The abuse of people by those in power becomes commonplace, and those that were originaly empowered to serve and protect are now the criminals themselves.

Take a good hard look around you. The current state the whole country is in is what happens when interest rates are high.

Answer 3

Interest rates impact investment decisions. It represents the cost of borrowing to invest in shopping centres, roads, education, health that will impact you everyday. It also represents the benefit of placing funds in cash and receiving payments in the form of interest.

If the rewards outweigh the cost and benefits then people will invest.