Changes in Consumer Confidence, Based on Household Surveys Change Consumer

question 173

Essay

Changes in consumer confidence, based on household surveys change consumer spending, because it helps consumers predict their spending. Increases in consumer confidence increases the autonomous consumption while a decrease in consumer confidence decreases consumer spending.

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Definitions:

Heuristics

Cognitive shortcuts or rules of thumb that simplify decision making.

Mental Set

A tendency to approach situations in a certain way because that method has worked in the past, potentially limiting problem-solving abilities.

Accuracy

The degree to which a measurement or calculation reflects the true value or correct result.

Precision

The accuracy and specificity with which an action is performed or a measurement is taken.