Gordon characterizes Modigliani as a prominent activist yet several implications of his life cycle hypothesis support the non-activists. One of these implications is

A) transitory increases in income associated with the business cycle are not expected to last a lifetime so current consumption is relatively stable.
B) permanent increases in income associated with the business cycle are not expected to last a lifetime so current consumption is relatively stable.
C) transitory increases in income associated with the business cycle are not expected to last a lifetime so current consumption is relatively unstable.
D) transitory increases in income associated with the business cycle are to last a lifetime so current consumption is relatively stable.


A

Economics

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