The Fundamental Lesson of the Life-Cycle and Permanent-Income Hypotheses Is

question 13

Multiple Choice

The fundamental lesson of the life-cycle and permanent-income hypotheses is that:

• A) individuals smooth their consumption patterns over their lifetimes.
• B) individuals vary their consumption patterns over their lifetimes.
• C) individuals' consumption patterns vary as their incomes change.
• D) individuals' consumption changes with changes in their temporary incomes.
• E) taxes are ineffectual.

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Definitions:

American Revolution

The period (1765-1783) during which the Thirteen Colonies in North America fought and gained independence from Great Britain, leading to the founding of the United States.

David Ramsay

An American physician, historian, and politician who lived in the late 18th and early 19th centuries, known for his contributions to American medical history and history of the American Revolution.

Constitution

Foundational tenets or traditional conventions that rule the functioning of a state or other structures.

Melting Pot

A metaphor for a society where many different types of people blend together as one, often referring to the assimilation of immigrants in the United States.