Empirical Studies of Franco Modigliani's Life-Cycle Hypothesis Show That

question 101

Multiple Choice

Empirical studies of Franco Modigliani's life-cycle hypothesis show that:

• A) most elderly individuals try to exhaust all their savings by the time they die.
• B) the elderly do not seem to run down their wealth in old age, as a simple version of the theory would predict.
• C) elderly individuals generally do not want to leave bequests for their children.
• D) precautionary saving is not an important saving motive for the elderly.

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Definitions:

Back Strain

An injury to the muscles or tendons in the back due to overstretching or tearing.

Hypoglycemia

Low blood sugar.

Insulin Shock

A severe form of hypoglycemia caused by an excess of insulin in the bloodstream, leading to symptoms like confusion, tremors, and in severe cases, coma.

Splint

A device used to immobilize and protect a body part.