Multiple Choice
Which of the following are two main assumptions of The Life Cycle Hypothesis?
A) People can earn in both the first and second stages of their life. People also prefer stability in their consumption patterns.
B) People earn in the first stage of their life, but they don't earn in the second stage of their life. Interest rates are higher in the second period of a person's life than they are in the first period of a person's life.
C) People earn in the first stage of their life, but they don't earn in the second stage of their life. People also prefer stability in their consumption patterns.
D) People earn in the first stage of their life, but they don't earn in the second stage of their life. People are indifferent about the stability of their consumption patterns.
Correct Answer:
Verified
Correct Answer:
Verified
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