Suppose households unexpectedly increase consumption and, Ask an Expert

Economics

Suppose households unexpectedly increase consumption and the central bank keeps the interest rate fixed. Which of the following will occur as a result of this consumer optimism?

A. an ambiguous effect on stock prices

B. no change in stock prices

C. stocks prices increase only if goods prices increase

D. a decrease in stock prices

E. an increase in stock prices

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Microeconomics, Economics

Category:- Microeconomics
Reference No.:- M91234042

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