In the permanent income hypothesis,income that does not persist for a long period of time is known as ________.
A)current income
B)transitory income
C)insufficient income
D)limited income

Question

Quizplus · Accepted Answer

According to the permanent income hypothesis, income that is short-lived or irregular is considered transitory income, which is distinct from long-term or permanent income. Therefore, the correct choice is B. Current income also refers to recent or present income, but this is not necessarily transitory. Insufficient income and limited income are not terms used in the permanent income hypothesis.

In the Permanent Income Hypothesis,income That Does Not Persist for a Long