Stock market wealth decreases. What is the impact on aggregate expenditures and income?
A) Both increase.
B) Both decrease.
C) Aggregate expenditure increases and income decreases.
D) Aggregate expenditure decreases and income increases.
B
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If Jane's marginal benefit as a consumer in the jeans market is larger than the price of a pair of jeans:
a. Jane will not purchase any more jeans. b. Jane can benefit by purchasing more jeans. c. the opportunity cost of a pair of jeans is lower than the price. d. Jane will decrease her total utility by purchasing more jeans.
A competitive market is in long-run equilibrium. If demand increases, we can be certain that price will
a. rise in the short run. Some firms will enter the industry. Price will then rise to reach the new long-run equilibrium. b. rise in the short run. Some firms will enter the industry. Price will then fall to reach the new long-run equilibrium. c. fall in the short run. All, some, or no firms will shut down, and some of them will exit the industry. Price will then rise to reach the new long-run equilibrium. d. not rise in the short run because firms will enter to maintain the price.