If consumers are very foresighted, we would expect actual consumption spending to:

Question

Quizplus · Accepted Answer

Consumers being very foresighted implies that they incorporate all available information about the future into their current consumption decisions. This behavior is consistent with the "random walk" hypothesis, which suggests that changes in consumption are unpredictable and follow a random pattern, as consumers adjust their spending based on new information as it becomes available.

If Consumers Are Very Foresighted, We Would Expect Actual Consumption