Economics · Macroeconomics
The life cycle theory of consumption postulates that: (A) Consumption is constant throughout a lifetime. (B) Marginal propensity to consume (MPC) out of permanent income is small. (C) MPC out of transitory income is large. (D) It emphasizes maintaining a stable standard of living over life.
Verified Solution4 OptionsUpdated: October 2026👁️1 View
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- 1(A), (B), (C), and (D)
- 2(B), (C), and (D) only
- 3(A) and (D) only✓
- 4(B) and (C) only
Correct answer
(A) and (D) only
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