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

Question

Quizplus · Accepted Answer

Changes in wealth from housing tend to have a more significant impact on consumer spending because housing is a more stable and long-term asset compared to stocks, which are more volatile.

The Effect of Changes in Wealth on Consumers' Spending Is