Multiple Choice
The debate about different consumption theories can be viewed as a debate over whether
A) the consumption of durable or non-durable goods should be considered
B) random events that can change consumption behavior really do occur
C) liquidity constraints do ever exist
D) the marginal propensity to consume is large or small
E) the average propensity to consume is less or greater than 1
Correct Answer:
Verified
Correct Answer:
Verified
Q4: The fact that consumption exhibits "excess sensitivity"
Q5: The random-walk theory of consumption predicts that<br>A)the
Q6: The life-cycle theory of consumption implies that<br>A)the
Q7: Liquidity constraints explain<br>A)why consumers may spend less
Q8: According to the permanent-income theory of consumption<br>A)permanent
Q10: The Barro-Ricardo equivalence proposition<br>A)states that debt-financing merely
Q11: The Barro-Ricardo equivalence proposition implies that tax
Q12: The proposition that financing debt by issuing
Q13: Empirical studies of aggregate consumption have shown
Q14: Consumption is an important element of aggregate