Question

Assertion (A): According to the Life Cycle Theory of consumption, an individual level of consumption depand not just on current income but also on long run expected earnings

Reason (R): Individuals are assumed to plan a pattern of expenditure based on expected earnings over lifetime.

Alternatives

(A) (A) is true, but (R) is false (B) Both (A) and (R) are false.

(C) (A) is not correct, but (R) is correct

(D) Both (A) and (R) are correct and (R) is correct explanation of (A)

Answer 1

Explanation:

c (A) is not correct but (R) is correct