A notable difference between household personal consumption expenditures and business investment spending is that personal consumption expenditures:
A) have increased in recent years, while investment spending remains flat.
B) have fallen in recent years, while investment spending has increased.
C) are relatively stable from year to year, while investment spending fluctuates widely.
D) fluctuate widely from year to year, while investment spending is relatively stable.

Question

Quizplus · Accepted Answer

Personal consumption expenditures tend to be more stable because they include everyday expenses that do not change dramatically over short periods, such as food, clothing, and housing. In contrast, business investment spending can fluctuate widely due to changes in economic outlook, interest rates, and business cycles, making it more volatile.

A Notable Difference Between Household Personal Consumption Expenditures and Business