According to the Permanent Income Hypothesis, Why Did Consumption and Borrowings

question 47

Multiple Choice

According to the permanent income hypothesis, why did consumption and borrowings grow substantially in the late 1990s and 2000s?

• A) The late 1990s and 2000s was a period of sustained and historically low interest rates.
• B) The government enacted income tax cuts for a year beginning in 1990.
• C) The prices of assets like property were continually falling in the late 1990s and 2000s.
• D) In the late 1990s and 2000s, the level of consumer confidence was low as employment

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Definitions:

Stress Reduction

strategies and techniques used to decrease stress levels in individuals, which can involve methods such as meditation, exercise, time management, and psychological therapies.

Universities

Higher education institutions that offer undergraduate and postgraduate degrees in various fields of study, usually involving research, teaching, and administrative services.

Stress-Buster

Informal term referring to any activity, technique, or intervention designed to reduce or alleviate stress.

General Adaptation Syndrome

A model describing the body's response to stress in three stages: alarm, resistance, and exhaustion.