The Creation and Deflation of Economic Bubbles Impacts the Sale

question 49

Multiple Choice

The creation and deflation of economic bubbles impacts the sale of homes, cars and other expensive goods because

• A)higher stock prices make people feel poorer so they buy fewer of these things.
• B)higher stock prices make people feel richer so they buy more of these things.
• C)higher interest rates make people more able to borrow money to buy these things.
• D)the creation of bubbles lowers the prices of these things and their deflation stimulates purchases.

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