Other determinants of consumption spending include each of the following except
A) household wealth.
B) expectations of income growth.
C) real exchange rate.
D) permanent vs. transitory income.

Question

Quizplus · Accepted Answer

The real exchange rate primarily affects a country's trade balance rather than direct consumption spending by households. Consumption spending is more directly influenced by factors such as household wealth, expectations of future income, and the nature of that income (permanent vs. transitory), rather than by the value of the country's currency in relation to others.

Other Determinants of Consumption Spending Include Each of the Following