For this question, ignore tax considerations of each of the following. Assume that consumption decisions are made according to the permanent income theory. Which of the following would lead to the smallest increase in current consumption?
A) winning $10,000 in the lottery
B) inheriting $10,000 from a relative
C) obtaining $10,000 by winning a lawsuit
D) getting a one-time $10,000 bonus from your employer
E) all of the above
E
Economics
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Suppose you hear of a great deal on a used car and wonder, "Why is the price so low?" This might be an instance of ________
A) tyranny of collateral B) adverse selection C) the free rider problem D) moral hazard
Economics
Refer to the above table. The table represents information on the costs for Ajax Corporation. Ajax operates in a perfectly competitive market and the price of the product is $7. What does profit equal when quantity equals 2?
A) $14 B) -$2 C) $16 D) $2
Economics