Which statement best defines the permanent income hypothesis?

Consumer spending is proportional to the ratio of people in stable full‑time employment– that is, with "permanent" income–and people in unstable part‑time employment–that is, with "temporary" income.

When in a recession, although current consumer spending can be observed, future consumer spending cannot be predicted due to an unknown number of people leaving their temporary recession jobs for higher‑paying, permanent jobs that better fit their skills.

Consumer spending depends on both the income and wealth of people in the economy.

Consumer spending depends on the level of disposable income that people expect to have over the course of their lifetime.