Economy, asked by alishanaaz3351, 1 year ago

Explain absolute income hypothesis and life cycle hypothesis of consumption.

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Answered by Anonymous

Answer:

1. Absolute Income Hypothesis: Keynes' consumption function has come to be known as the 'absolute income hypothesis' or theory. ... He said that consumption is a stable function of current income (to be more specific, current disposable income—income after tax payment)

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