Which of the Following Correctly Describes How an Increase in the Price

question 231

Multiple Choice

Which of the following correctly describes how an increase in the price level affects consumption spending?

• A)An increase in the price level raises real wealth,which causes consumption to increase.
• B)An increase in the price level decreases the amount of money a household needs to buy goods and raises the interest rate,which causes consumption to increase.
• C)An increase in the price level increases the amount of money a household needs to buy goods and raises the interest rate,which causes consumption to increase.
• D)An increase in the price level lowers real wealth,which causes consumption to decrease.

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Definitions:

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The complex of nerve tissues that controls the activities of the body, comprising the brain and spinal cord.

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A psychological theory explaining a disconnection and lack of continuity between thoughts, memories, surroundings, actions, and identity.

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A therapeutic approach that aims to change negative patterns of thinking or behavior that are contributing to a person's difficulties.

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