In which of the following situations are people most likely to spend more?
A)when their real wealth and interest rates rise
B)when their real wealth rises and interest rates fall
C)when their real wealth falls and interest rates rise
D)when their real wealth and interest rates fall

Question

Quizplus · Accepted Answer

When people's real wealth rises, they have more disposable income to spend, and when interest rates fall, borrowing becomes cheaper, making it easier for people to spend more. Therefore, when both of these conditions are met, people are more likely to spend more.

In Which of the Following Situations Are People Most Likely