The Most Important Determinant of a Household's Consumption Spending Is

question 33

Multiple Choice

The most important determinant of a household's consumption spending is:

• A)its disposable income.
• B)the in-kind transfers received by the household.
• C)the level of education of the members of the household.
• D)the interest rate.
• E)the ratio of wage to non-wage income of the household.

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Definitions:

Real GDP

Gross Domestic Product after adjustments for inflation; measures the value of all goods and services produced within a country's borders in a specific time period using constant prices.

Deflation

A decrease in the general price level of goods and services, often leading to an increase in the real value of money.

Inflation

The progression at which the price level for goods and services at large advances, lessening the potency of purchasing.

Housewives

Individuals, traditionally women, who manage households and may or may not engage in paid employment outside the home.