Households held $1.5 trillion in common stock at year-end 19X1. Assuming stock prices doubled during 19X2 and no additional household purchases of stock were made during that year, household savings would rise by at least $1.5 trillion during 19X2.

Question

Quizplus · Accepted Answer

Household savings refer to the portion of income not spent on consumption, not the increase in value of existing assets like stocks. The doubling of stock prices increases wealth, not savings.

Households Held $1