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    Principles of Macroeconomics Study Set 11
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    Exam 16: Household and Firm Behavior in the Macroeconomy: a Further Look
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    Consider a Household That Has a Sudden Unexpected Increase in Wealth
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Consider a Household That Has a Sudden Unexpected Increase in Wealth

Question 26

Question 26

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Consider a household that has a sudden unexpected increase in wealth, perhaps an inheritance from a distant relative. How will the household's consumption pattern be affected?

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Few spend the entire inheritan...

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