As the interest rate increases, the opportunity cost of _____. a. borrowing decreases b. past consumption decreases c. current consumption increases d. saving increases e. saving decreases
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As the interest rate increases, the
a. borrowing decreases
b. past consumption decreases
c. current consumption increases
d. saving increases
e. saving decreases
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- The position of IS curve depends on_______. Select one: a. none of the given options b. rate of investment, c. rate of interest, d. autonomous expenditurei. Draw a circular flow of diagram and identify the parts of the model that corresponds to the flow of goods when Marks earns $2000 from his 15 percent ownership of apple stock . ii.classify the following statement as positive or normative and explain “ higher tax rates discourage savings and workings “Draw a savings and investment graph. Explain the logic of why investment slopes down and savings slopes up.
- Below are the information of four sector economy. All values are in RM billon. The saving function [Fungsi tabungan] : S = -200 + 0.15 Yd Investment, [Pelaburan] : I = 500 Government spending [Perbelanjaan kerajaan] : G = 300 Tax [Cukai] : T =100 Export (X) : X=200 Import (M) : M=100 Based on the data above, calculate the: d. Sketch the diagram to illustrate your answer in ( c ) e. Calculate the value of average propensity to consume (APC) and average propensity to save at the equilibrium level.The law of Time Preference tells us that A. People always value a good available in the near future more highly than an equal quantity of the same good available in the more remote future, all other things equal B. People prefer a greater quantity of a good to a lesser quantity of the same good C. People will always choose the shortest processes of production D. People will always devote more of their resources to consumption than to investment, all other things equalOf means-tested programs and IRA’s, which lower the rate of return on saving? a. Both means-tested programs and IRA's. b. Means-tested programs, but not IRA's. c. IRA's but not means-tested programs. d. Neither means-tested program, or IRA's.
- Suppose a consumer has $1500 in the current time period and $1100 in the future time period.Suppose also that the consumer can borrow and lend freely and, unless otherwise specified, borrowing and lending interest rates are the same. (a) If the interest rate between time periods is 50%, what is the budget constraint between consumption in the present and consumption in the future? (B) If the interest rate at which the consumer can borrow is 75% but the rate at which she can lend is25%, what is the budget constraint? (C) Suppose the interest rate is 50%. If the consumer has to pay a fee of 10% of the loan amount in order to borrow money, what is the budget constraint?Give typing answer with explanation and conclusion Which of the following statements concerning consumption is incorrect? A. WEALTHY PEOPLE CONSUME MORE THAN OTHER PEOPLE. B. EXPECTATIONS ABOUT FUTURE PRICES AFFECT CONSUMPTION. C. MARGINAL PROPENSITY TO CONSUME USUALLY DECREASES AS INCOMES RISE. D. SAVINGS RATES DECREASE AS INCOME INCREASES. E. TAX INCREASES REDUCE CONSUMPTION.When Ani’s income changes from $400 to $1000, her saving changes from $100 to $580. Ani’s Marginal Propensity to Consume =
- If Evan's income is reduced to zero after he loses his job, his consumption will be ________ and his saving will be ________. a.greater than zero; less than zero b.greater than zero; greater than zero c.less than zero; greater than zero d.less than zero; less than zeroIf current and future consumption are both normal goods, a decrease in the interest rate will necessarily A. cause savers to save more. B. cause borrowers to borrow less. C. reduce everyone’s current consumption. D. make everyone worse off. E. None of the above.“Permanent Income of consumption is just the average of all current and future incomes. Thus, one does not need to do the maximisation of intertemporal utility”. True or False. Discuss according to the model. Note that you need to discuss according to the model?