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According to the Permanent-Income Hypothesis, If Consumers Receive a One-Time

Question 85

Multiple Choice

According to the permanent-income hypothesis, if consumers receive a one-time income bonus, then they will:


A) save most of it in the current year.
B) spend most of it in the current year.
C) spend one half of it and save one-half of it in the current year.
D) not alter their consumption or saving in the current year.

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