the country's central bank (in the uk it's the bank of england), must decide on weither or not to raise or lower interest rates as a way of controling inflation( the increase in price of everyday goods and services). they have the job of not letting inflation go over a pre-determined target
recession is 2 periods of negative economic growth, in terms of the economy the year is divided into periods (or quarters) each one is 3 months
negative equity is where you end up oweing more on your house than it's actually worth.Interest rates? negative equity? inflation? Recession? How does this work and how does it affect the economy?
All these things means everyone has less spare cash to spend,
as there outgoing costs are higher,
so off course the economy suffersInterest rates? negative equity? inflation? Recession? How does this work and how does it affect the economy?
if your house is worth less than the amount you owe on the mortgage that is negative equity.
Why don't you pick one of those and ask a more focus question. It would take an entire college textbook to answer that.
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