If a country's central bank raises interest rates, how should a business planning to borrow money for a big new factory likely change its investment plans?

When a country's central bank raises interest rates, it directly increases the cost of borrowing money throughout the economy. The central bank is a national financial institution responsible for managing the money supply and setting benchmark interest rates, which influence the rates commercial banks offer to their customers. For a business planning to borrow money for a significant investment like a new factory, this action means that the loan it would take out will become more expensive. Interest rates represent the cost of borrowing money, and higher rates translate into larger interest payments over the life of the loan, increasing the overall exp....