Suppose a Fall in Stock Prices Makes People Feel Poorer

question 134

Multiple Choice

Suppose a fall in stock prices makes people feel poorer.The decrease in wealth would induce people to

• A)decrease consumption,shown as a movement to the left along a given aggregate-demand curve.
• B)increase consumption,shown as a movement to the right along a given aggregate-demand curve.
• C)decrease consumption,shown by shifting the aggregate-demand curve to the left.
• D)increase consumption,shown by shifting the aggregate-demand curve to the right.

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Definitions:

HDC Status

A legal term describing the status of a holder in due course, who acquires a negotiable instrument under certain conditions, granting them rights free from many defenses.

Sufficient Consideration

Consideration in contract law that is adequate and meets legal requirements, ensuring the contract is binding and enforceable.

Promissory Note

A financial document in which one party promises to pay another party a specified sum of money at a defined future date or on demand.

Payable

Refers to the amount of money that is owed by an individual or organization and is due to be paid.