If People Base Their Spending Decision More on Permanent Income

question 106

Multiple Choice

If people base their spending decision more on permanent income than current income,then

• A)consumption spending will be more responsive to a temporary change in income than a change in permanent income
• B)shifts in aggregate supply will be less predictable than if spending was based on current income
• C)consumption spending will fluctuate more widely than if such spending was determined by current income
• D)shifts in short-run aggregate supply will be more predictable than if spending was based on current income
• E)attempts to fine-tune the economy with temporary tax rate adjustments will be less effective

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Definitions:

Research The Salary

The act of investigating and gathering information about the compensation levels for specific positions within an industry or organization.

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The set of shared beliefs, values, norms, and practices that defines the social and psychological environment of a business or institution.

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The degree to which an individual's character and personal traits match those required or valued in a particular context or environment.

Thank-you Message

A courteous expression of gratitude, typically conveyed in written or spoken form, often used in professional and personal contexts to acknowledge receipt of a service, gift, or favor.