Assume That Consumption Decisions Are Made According to the Permanent

question 34

Multiple Choice

Assume that consumption decisions are made according to the permanent income theory. Which of the following would lead to the largest increase in current consumption?

• A) Winning $10,000 in the lottery.
• B) Obtaining $10,000 by winning a lawsuit.
• C) Getting a one- time $10,000 bonus from your employer.
• D) Taking a new job with a salary that is $10,000 higher than your current salary.
• E) Inheriting $10,000 from a relative.

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Definitions:

Community Feeling

A sense of belonging and connection individuals experience within a group or society, often associated with mutual support and shared values.

Dreams

A series of thoughts, images, and sensations occurring in a person's mind during sleep, often reflecting subconscious emotions and desires.

Psychotic Compulsions

Intense, uncontrollable urges to perform certain actions, often experienced by individuals with psychotic disorders.

Hidden Conflicts

Internal psychological struggles that are not apparent to the individual or observers but influence behavior and emotions.