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The following diagram depicts Julia’s choice of consumption in periods 1 and 2. She has no income in period 1 and an income of $115 in period 2. The current interest rate is 15%. Based on this information, which of the following statements is correct?
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The diagram depicts Julia’s indifference curve for consumption in periods 1 and 2. Based on this information, which of the following statements is correct?
The diagram depicts Julia’s choice of consumptions in periods 1 and 2. She has no income in period 1 and an income of $100 in period 2. In scenario 1 the interest rate is 10%, while in scenario 2 it is 78%. Based on this information, which of the following statements is correct?
The diagram depicts Marco’s choice of consumptions in periods 1 and 2. He has $100 worth of grain in period 1 and no income in period 2. Marco has two choices. In scheme 1, he can store the grain that he does not consume in period 1. This results in a loss of 20% of the grain due to pests and rotting. In scheme 2, he can sell the grain that he does not consume and lend the money at 10%. Based on this information, which of the following statements is correct?