Multiple Choice
According to the life-cycle theory of consumption, what should have occurred after the stock market crash of 1987?
A) a decrease in current consumption
B) no change in current consumption since only nominal wealth was lost
C) no change in aggregate consumption since most people do not invest in the stock market
D) an increase in consumption since people were afraid to save
E) both B and C
Correct Answer:
Verified
Correct Answer:
Verified
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