According to the life-cycle hypothesis,as people grow older ________.
A)their wealth grows before and after retirement
B)their wealth declines before and after retirement
C)their wealth grows before retirement,then declines after retirement
D)their wealth falls before retirement,then rises after retirement

Question

Quizplus · Accepted Answer

The life-cycle hypothesis suggests that individuals tend to save during their working years in order to build up their wealth for retirement. Therefore, their wealth tends to grow before retirement. However, once they retire and begin drawing down their savings, their wealth tends to decline. Therefore, option C is the best choice as it reflects both the growth and decline of wealth in relation to retirement.

According to the Life-Cycle Hypothesis,as People Grow Older ________