Suppose That Your Annual Income Has Averaged $40,000 for the Past

Multiple Choice

Suppose that your annual income has averaged $40,000 for the past 10 years and that you expect it will average $40,000 over the next 10 years. If your income this year increases to $50,000 but your consumption expenditures don't change, then you are most likely acting according to the

A) transitory income theory of consumption.
B) current income hypothesis.
C) permanent income hypothesis.
D) disposable personal income theory of consumption.