According to the life-cycle income hypothesis, if the retirement age increases but life expectancy decreases: a. consumption increases and savings increase b. consumption increases and savings might increase or decrease c. consumption decreases and savings decrease d. consumption decreases and savings might increase or decrease e. consumption might increase or decrease and savings decrease
According to the life-cycle income hypothesis, if the retirement age increases but life expectancy decreases: a. consumption increases and savings increase b. consumption increases and savings might increase or decrease c. consumption decreases and savings decrease d. consumption decreases and savings might increase or decrease e. consumption might increase or decrease and savings decrease
Chapter9: Aggregate Demand
Section: Chapter Questions
Problem 2.5P
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Question
According to the life-cycle income hypothesis, if the retirement age increases but life expectancy decreases:
a. consumption increases and savings increase
b. consumption increases and savings might increase or decrease
c. consumption decreases and savings decrease
d. consumption decreases and savings might increase or decrease
e. consumption might increase or decrease and savings decrease
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