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Questions › CUET-PG › CUET-PG 2026 › Q15
4 marks, −1Macroeconomics › Consumption and investment › Relative income, permanent income and life-cycle hypothesesEasyabout 1 min

CUET-PG 2026 Question 15: Consumption and investment

The permanent income hypothesis was propounded by:

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Answer and worked solution

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Consumption and investment has come up 74 times in 7 exams since 2005.

What this question tests

This question is on Relative income, permanent income and life-cycle hypotheses, part of Consumption and investment in Macroeconomics.

Why consumption reacts less than one-for-one to temporary income changes.

TestStop has 19 past-paper questions on this subtopic; the nearest in year are below.

  • IIT JAM 2021 · Q59Individuals earn and consume from age 18, retire at 60 and die at 90, leaving no debt or bequests. Income at…
Take this paper as a timed mockMore on Relative income, permanent income and life-cycle hypotheses

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Question from the CUET-PG 2026 paper. Solutions are TestStop's own. Not affiliated with or endorsed by any examination authority.