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:

Sexual Abuse

Non-consensual activities or actions of a sexual nature that harm or exploit one or more individuals.

Incest

Sexual relations between family members or close relatives that are considered taboo by societal norms.

Extrafamilial

Occurring or existing outside the family unit; involving persons who are not members of one's family.

Verbal Cues

Elements of communication expressed through spoken words that convey messages or suggestions, often used to signal or emphasize ideas.