The "wealth effect" claims that for every $100 of additional wealth generated in an individual's stock market holdings,the individual will spend $10 (10 percent).

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The "wealth effect" suggests that as people's wealth increases, particularly through rising asset values like stocks or real estate, they feel more financially secure and are likely to spend more. However, the specific percentage of additional spending (like the 10 percent mentioned) is not a fixed rule and can vary widely among individuals and economic contexts.

The "Wealth Effect" Claims That for Every $100 of Additional