Asked by Ryan Matthew McCarthy on Jun 11, 2024
Verified
Historically,consumption spending in the United States has _____.
A) fluctuated greatly with changes in the level of income
B) remained approximately constant as a percentage of income
C) decreased as a percentage of income
D) varied inversely with the inflation rate
E) varied inversely with the interest rate
Consumption Spending
The total value of all goods and services consumed by households within a certain period.
Inflation Rate
The percentage change in the price level of goods and services in an economy over a period of time, often indicating the decrease in purchasing power of a currency.
- Pinpoint the determinants affecting expenditure on consumption.
Verified Answer
GC
Grace CaugheyJun 12, 2024
Final Answer :
B
Explanation :
Consumption spending in the United States has remained approximately constant as a percentage of income over time, indicating a stable relationship between income and spending habits of consumers. However, there may be short-term fluctuations in response to changes in economic conditions such as interest rates, inflation, and consumer confidence.
Learning Objectives
- Pinpoint the determinants affecting expenditure on consumption.