Question

Which of the following statements best describes the "wealth effect," as described in the textbook?
(a) Households with equity in their houses are wealthier than households that rent their housing
(b) Expected appreciation in assets, such as home equity, may increase spending on other goods and services in the economy
(c) Economists believe that wealthier households have a positive effect on the housing market, while low-income households have negative effect
(d) A 10 percent increase in homeownership is associated with a 12 percent increase in economic growth

Answer

This answer is hidden. It contains 1 characters.