The effect of changes in wealth on consumers' spending is
A)significantly higher if the change in wealth arises from the housing market rather than the stock market.
B)significantly lower if the change in wealth arises from the housing market rather than the stock market.
C)significantly higher if the change in wealth arises from saving rather than from the housing market.
D)not dependent on the type of wealth.

Question

Quizplus · Accepted Answer

Changes in wealth from the housing market tend to have a more significant impact on consumer spending because housing is a more widely held asset and changes in its value are perceived as more permanent compared to the stock market.

The Effect of Changes in Wealth on Consumers' Spending Is