The so-called wealth effect will result in households
A)spending more and saving less.
B)spending less and saving more.
C)spending less and saving less.
D)spending more and saving more.

Question

Quizplus · Accepted Answer

The wealth effect suggests that when households perceive an increase in their wealth, they feel more financially secure and are likely to spend more and save less.

The So-Called Wealth Effect Will Result in Households