The theory of intertemporal choice, and the life-cycle and permanent income hypotheses have in common the assumption that ________
A) consumption decisions are affected by current expectations about lifetime resources
B) consumption decisions are based on all available information
C) current income, rather than expected income, has the greater influence on consumption decisions
D) decisions to borrow and save are influenced much more by immediate circumstances than by long-term consequences
A
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Utilitarianism is based on the argument that
A) the greater a person's income, the smaller is the marginal benefit of a dollar. B) by transferring a dollar from a millionaire to a poor person, more is lost than gained. C) taxing people's income from employment makes them work less. D) a dollar taken from a rich person does not end up as a dollar in the hands of a poorer person.
Construction workers at times face high rates of unemployment because their work is both seasonal and subject to wide swings over the business cycle
a. True b. False Indicate whether the statement is true or false
In the consumption function, consumption is caused by changes in the:
a. price level. b. level of disposable income. c. interest rate. d. level of investment. e. level of real assets.
To move up the income ladder and achieve high-income status, countries must
a. have sustained economic growth. b. restrict international trade. c. encourage the production of consumption goods rather than investment goods. d. maintain high inflation.