Multiple Choice
The random-walk theory of consumption predicts that
A) the slope of a line relating C(t+1) to C(t) is equal to 1
B) the slope of a line relating C(t+1) to C(t) is equal to 0
C) the slope of a line relating C(t+1) to C(t) is close to 0
D) the slope of a line relating C(t) to Y(t) is close to 1
E) none of the above
Correct Answer:
Verified
Correct Answer:
Verified
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