What Does Gatsby Reply When Nick Asks Him How He Makes His Money? Why Does Nick Find That Significant?

In addition to
the great response above, it is good to add that this particular point in the novel is one of
personal victory to . He is there with , and he is about to show her around his house. Showing
off how "well" he has done for himself means, to Gatsby, that he is finally worthy of
Daisy. Havingthere serves as further proof to Gatsby that he is distinguished and admired by
many.

However, in the conversation that ensues as Daisy goes to wash her
face, we notice that there are cracks in Gatsby's surface that reach straight to the core of his
insecurities and his feelings of worthlessness. After all, Gatsby is not about who he is, but
what he has.  

"The house looks well, doesn't
it?" he [Gatsby] demanded. "See how the whole front of it catches the
light."

I agreed that it was splendid.

"Yes." His eyes went over it, every arched door and square tower. "It
took me just three years to earn the money that bought it."

"I
thought you inherited your money."

At this point,
Gatsby gets nervous realizing that he has been caught in a lie, a type of lie that would push
him quite low in the social ranking of the peers that he is desperately trying to impress. The
society that Gatsby wants to dominate is one where everything is given for no reason. They are
idle heirs and heiresses with not a worry in the world who have never had to work for a living.
To that society, working for a living is something done by the poor by birthhence, their
feelings of entitlement and debauchery with the money and all the many things they inherit just
for being who they are. Gatsby does not share this origin, and it gnaws at him inside. This is
why the next exchange makes Gatsby more guarded still. 

"I did, old sport," he said automatically, "but I lost most of it in the
big panic -- the panic of the war."

I think he hardly knew what he was
saying, for when I asked him what business he was in he answered, "That's my affair,"
before he realized that it wasn't the appropriate reply.

After telling Nick off, basically, Gatsby immediately tries to gain ground by
retracting his reply and adding that "he has been many different things."  This is
evidence of Gatsby's inner fears of his origins and his backgroundand also of the fact that he
knows he is deceiving others as well as himself.