What is the most likely effect of higher interest rates on a firm planning to borrow for new machinery?
The investment becomes more expensive to finance
The firm's saving earns less interest
The machinery's productivity must fall
The firm's tax bill becomes zero
29 exam-style questions on OCR GCSE Economics 3.6 Monetary policy, covering 3.6.1 What is monetary policy, 3.6.2 Monetary policy and macro objectives, and 3.6.3 Effects of monetary policy. Each one has a worked solution and a mark scheme showing where the marks go.