Milton Friedman, an economist, proposed in the late 1950s that when consumers consider what they can spend, most people assess what they are going to earn during their entire lifetime (permanent income) rather than their current income. If given a little extra cash due to a government policy, consumers are more likely to save than spend that extra cash.
The government recently gave out stimulus checks. What is the government trying to accomplish with this? What do you think consumers will do?
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