Juan is 80 years old. Over Juan's adult lifetime, he accumulated savings for several decades and is using that savings to cover his expenses in retirement. Early in life when his income was low, he borrowed funds several times to cover his expenses, paying back the loans over the next few years. Juan's consumption pattern over his lifetime was influenced heavily by his:

Question

Quizplus · Accepted Answer

Juan's consumption pattern is influenced by his permanent income, which refers to his average lifetime income and affects his long-term consumption decisions, rather than his annual income or wealth at any given time.

Juan Is 80 Years Old