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If the Collateral Constraint Does Not Bind,then in Response to a Decrease

Question 5

Multiple Choice
If the collateral constraint does not bind,then in response to a decrease in the price,p,of the asset

If the collateral constraint does not bind,then in response to a decrease in the price,p,of the asset


A) the consumer increases both current and future consumption.
B) the consumer decreases current consumption and future consumption is unchanged.
C) the consumer leaves current consumption unchanged and increases future consumption.
D) the consumer increases current consumption and decreases future consumption.
E) the consumer decreases both current and future consumption.

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