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Assess how investment decisions are influenced by expected future interest rate movements, indicating any confounding factors...

Assess how investment decisions are influenced by expected future interest rate movements, indicating any confounding factors by investor habits and the resulting impact on the investment markets.

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There are both positive and negative effects on investments due to interest rate changes. Low-interest rates make investors borrow more from the market and spend accordingly, investors might spend more on acquisitions. Due to inflation, there are changes in demand and supply and the effect of change of demand and supply on products and services is a confounding factor.

The change in demand and supply due to inflation and other factors leads to the financial market crisis. The changes in interest rates dramatically change the preferences of investors.

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