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The Pigou effect:
A) suggests that as prices fall and real money balances rise, consumers should feel less wealthy and spend less.
B) suggests that as prices fall and real money balances rise, consumers should feel wealthier and spend more.
C) suggests that as prices fall and real money balances rise, consumers should feel less wealthy but spend more.
D) is generally accepted as adequate proof that the economy must be able to correct itself.
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Over the past month, the 500 customers have downloaded the following number of songs from WalMart's website (obviously, they have had more, but we need to use workable numbers): 13
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