Multiple Choice
Suppose that when your wealth increases from $100,000 to $200,000, your holdings of savings deposits increase from $10,000 to $12,000. Your wealth elasticity of demand for savings deposits then is
A) less than 1 and savings deposits are a necessity asset.
B) greater than 1 and savings deposits are a necessity asset.
C) less than 1 and savings deposits are a luxury asset.
D) greater than 1 and savings deposits are a luxury asset.
Correct Answer:
Verified
Correct Answer:
Verified
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