Why do interest rates on loans tend to be higher in a strong economy than in a weak one?
a. credit markets increase in a strong economy, and with increased demand come increased prices.
b. a strong economy encourages borrowers to take out very long-term loans, which have higher interest rates.
c. credit is plentiful in a strong economy, so it is harder to build up the good credit rating necessary for a low interest rate.
d. people in a strong economy have more money, so they can afford more expensive loans.

the answer is A.

 Credit markets increase in a strong economy, and with increased demand come increased prices.

A strong economy can be defined as an economy which has a strong industrial base, good shares prices, vast industrialization, high GDP etc.

A strong economy has high credit rates because when the demand is high, the prices are high. When the demand is less, the prices are less.

So, option A: credit markets increase in a strong economy, and with increased demand come increased prices. - is the correct answer.

correct answer:

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step-by-step explanation: