Which of the Following Statements Is an Example of the Wealth

question 33

Multiple Choice

Which of the following statements is an example of the wealth effect?

• A)If people feel wealthier because their stock portfolios have risen,they tend to increase their consumption of goods and services.
• B)One of the many factors that caused the Great Depression was that by 1930 the market for consumer durables was saturated.
• C)When wealthy people expect a recession they tend to postpone major purchases until times get better.
• D)When people expect inflation they often buy consumer durables before prices go up.

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Definitions:

Consistency

The quality of maintaining a uniform, stable, and predictable character or performance over time.

Concise Language

The use of few words to convey an idea effectively without unnecessary elaboration.

Antidepressants

Medications used to treat depression and other mental health conditions by adjusting chemicals in the brain.

Antihistamines

Medications used to relieve symptoms caused by allergies, such as sneezing, itching, and runny nose by blocking histamine in the body.