If the interest rate is decreased in an economy, it will

* Lower Interest rates encourage additional investment spending , which gives the economy a boost in times of slow economic growth. * Changes in interest rates affect the public's demand for goods and services and, thus, aggregate investment spending. * A decrease in interest rates lowers the cost of borrowing, which encourages businesses to increase investment spending. * Lower interest rates also give banks more incentive to lend to businesses and households, allowing them to spend more.