There are strong theoretical reasons to expect that changes in wealth are responsible for changes in consumption. Nonetheless, one reason that we observe a tight link between consumption and disposable income is...
A) credit rationing which changes the intertemporal budget constraint for borrowers.
B) households attempt to smooth their consumption.
C) household saving provides a buffer between income and expenditure.
D) ricardian equivalence.
Correct Answer:
Verified
Q1: If, for John's current intertemporal consumption pattern
Q3: The accelerator principle states:
A)if an increase in
Q4: Which best describes consumer surplus?
A)the price consumers
Q5: Which of the following statements is NOT
Q6: Community surplus equals:
A)producer surplus minus consumer surplus
B)profits
Q7: Monopoly power in a market is likely
Q8: A positive consumption externality occurs when:
A)the social
Q9: A merit good:
A)is a public good
B)involves a
Q10: A demerit good:
A)is a public good
B)involves a
Q11: A public good will probably:
A)be expensive in
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