Multiple Choice
A temporary increase in income today leads to
A) a small increase in current consumption.
B) a large increase in current consumption.
C) a small decrease in future consumption.
D) a large decrease in future consumption.
Correct Answer:

Verified
Correct Answer:
Verified
Related Questions
Q9: If government spending does not change,an increase
Q10: For a lender,an increase in the real
Q11: An increase in first-period income results in<br>A)
Q12: The Ricardian Equivalence says<br>A) whatever the level
Q13: An increase in the real interest rate<br>A)
Q15: The Ricardian Equivalence holds only if<br>A) the
Q16: For a borrower,an increase in the real
Q17: Why don't consumers work in the two-period
Q18: Why is it important that consumers respond
Q19: The endowment point is the consumption bundle