For a Consumer Not Bound by the Collateral Constraint, a Reduction

Multiple Choice

For a consumer not bound by the collateral constraint, a reduction in the price of the collateral leads to

A) nothing.
B) an increase in current consumption and a decrease in future consumption.
C) a decrease in current consumption and no change in future consumption.
D) a decrease in current and future consumption.
E) no change in current consumption and a decrease in future consumption.