During an economic expansion, housing and stock prices generally
A) fall, leading to a reduction in aggregate demand.
B) fall, leading to an increase in aggregate demand.
C) rise, leading to a reduction in aggregate demand.
D) rise, leading to an increase in aggregate demand.

Question

Quizplus · Accepted Answer

During an economic expansion, housing and stock prices typically rise, as consumer and investor confidence increases along with economic growth. This leads to an increase in aggregate demand as individuals feel wealthier and are more likely to spend money.

During an Economic Expansion, Housing and Stock Prices Generally