The idea of the life-cycle theory of consumption is that people make lifetime consumption plans.

Question

Quizplus · Accepted Answer

The life-cycle theory of consumption proposes that individuals make consumption decisions based on their lifetime income and consumption goals, taking into account factors such as age, income, and retirement expectations. This theory suggests that people save more when young in order to maintain their consumption levels in old age, when their income is likely to decline. Therefore, the theory assumes that individuals do make lifetime consumption plans.

The Idea of the Life-Cycle Theory of Consumption Is That