What Is the Wealth Effect

question 23

Multiple Choice

What is the wealth effect?

• A)The effect of a change of wealth on consumption.
• B)The effect of a change of wealth on savings.
• C)Total consumer wealth divided by income.
• D)The effect of a change in income on wealth.

---

Definitions:

Export Units

Export Units refers to the quantity of goods or services sent out of a country to foreign markets.

Import Units

A measure concerning the quantity of goods or services that a country brings in from other countries for domestic consumption or use.

Trade

The exchange of goods, services, or both between two or more parties, either within an economy or between economies.

Comparative Advantage

The ability of an individual, firm, or country to produce a particular good or service at a lower opportunity cost than others.