From 2008 to2009, the falling stock market reduced the wealth of U.S. households, causing the United States:
A) to move down along its consumption schedule.
B) to shift its consumption schedule downward.
C) to move up along its consumption schedule.
D) to shift its consumption schedule upward.

Question

Quizplus · Accepted Answer

The reduction in wealth due to the falling stock market would lead to a decrease in consumption at each level of income, causing the consumption schedule to shift downward.

From 2008 To2009, the Falling Stock Market Reduced the Wealth