An individual holds $10,000 in a checking account and the price level rises significantly. Hence
A) the individualʹs real wealth decreases but real national wealth increases.
B) the individualʹs wealth increases.
C) there is no change in the individualʹs real wealth.
D) the individualʹs real wealth and consumption expenditure decrease.

Question

Quizplus · Accepted Answer

When the price level rises significantly, the purchasing power of money decreases, leading to a decrease in the individual's real wealth and potentially reducing their consumption expenditure.

An Individual Holds $10,000 in a Checking Account and the Price