According to Friedman's Permanent-Income Hypothesis, If the Marginal Propensity to Consume

question 29

Multiple Choice

According to Friedman's permanent-income hypothesis, if the marginal propensity to consume out of permanent income equals 0.9 and current income equals $55,000 (of which $5,000 is transitory income) , then consumption should equal:

• A) $5,000.
• B) $45,000.
• C) $49,500.
• D) $55,000.

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Definitions:

High Levels

Typically refers to a significant or above-average measure of a certain quality or quantity, such as productivity or achievement in a given context.

Situational Leadership Model

A leadership theory proposing that the most effective leadership style varies according to the situation and the level of maturity of the followers.

Selling Style

Describes the approach or method a salesperson uses to engage with, persuade, and secure clients or customers.

High Task Behavior

A leadership approach that focuses primarily on the tasks at hand, ensuring they are completed efficiently and effectively.