d) Now suppose that instead of y = 100, the consumer has y = 140. Again, determine optimal consumption in the current and future periods and optimal saving, and show this in a diagram. Is the consumer a lender or a borrower? e) Explain the differences in your results between parts (c) and (d).
Q: (a) The International Monetary Fund (IMF) has responded to the coronavirus crisis with unprecedented…
A: COVID 19 stands for corona virus disease, and it emerged in 2019, so named as per the year…
Q: IV. A small business determined that the price-demand and cost functions for producing and selling x…
A: Answer: Given, Demand function:px=70-0.25xCost function:Cx=0.5x2+10x+800 (1). To find the marginal…
Q: One of the growers is excited by this advancement because now he can sell more crops, which he…
A: Elastic of demand refers to the percentage change in quantity demanded due to the percentage change…
Q: The market for used phones is perfectly competitive. The Marginal Willingness to pay (MWTP) and the…
A: Buyer MWTP Seller MC A $346 U $871 B $689 V $428 C $222 W $228 D $933 X $455 E $394 Y $715…
Q: D 1. when both supply and demand curve shift to right the equlibrium price always falls the…
A: Since you have asked multiple questions, we will solve the first question for you. If you want any…
Q: A computerized wood lathe, costing P25,000, will be used to make ornamental parts for sale. Receipts…
A: Given initial cost = 25000 P Reciepts each year = 60000 P Costs = 55000 P Salvage value = 9000 Time…
Q: Suppose Sam is willing to pay A total of 280,000 for an apartment. True or false: keep his maximum…
A: The maximum price or price range that an individual is ready to pay for purchasing a good or service…
Q: Evaluate the two alternatives A and B and decide the economic justified alternative using: Present…
A: Since you have posted multiple subparts as per the guidelines we can solve only the first 3…
Q: For producing a specific product Two processes can .be used Process X will have a first cost of…
A: given that, for alternative x initial cost is $160000, operating cost is $7000 and salvage value is…
Q: 3. Determined whether each statement is true or false and provided an explanation. A. If a firm has…
A: "Since you have asked a question with multiple sub-parts, we will solve first three sub-parts for…
Q: Which of the following describes the attribute of a risk neutral investor? Select one: a. An…
A: Risk neutral is a term that is utilized to portray financial backers who are harsh toward risk. The…
Q: You are given the market demand function Q=2200-1000p, and that each duopoly firm's marginal cost is…
A: Cournot competition is an financial version used to explain an enterprise shape wherein agencies…
Q: A restaurant selling hamburgers has fixed costs of $11,975 and sells the burgers for $6.50 each. The…
A: The point that depicts revenues of the firm being earned are equal to their expenses being incurred…
Q: 1. Any point inside the PPF is considered a. Productive b. inefficient c. unattainable d. efficient…
A: The measure that depicts various combinations of goods that could be produced using the given…
Q: Assume the economy starts at full-employment. There is a global pandemic. Which of the following…
A: A pandemic, or an epidemic of illnesses, would cause the economy to decline, eventually leading to a…
Q: What do you know about the Constraints to the Development of Cooperatives in Indonesia
A: With a population of 252 million people, Indonesia is Southeast Asia's largest economy and the…
Q: utility subject to the budget constraint it faces, i.e., max U = In C₁ +0.7 In C₂ such that C₁ + B₂…
A: Hi there , as per our guidelines we can only solve 1 question with maximum 3 sub parts at a time .…
Q: If a store increases its prices by 20% and its total revenue decreases by 10%, the demand it faces…
A: Since you have asked multiple question, we will solve the first question for you. If you want any…
Q: Consider the simple economy that produces only three products. Use the information in the following…
A: The Consumer Price Index (CPI) is a measure of an economy's overall price level. The CPI is made up…
Q: 5) Use the table below to answer the following questions. Table 2 Taco Stans Pizza Sellers Firm Name…
A: The measure that depicts the way in which classification and differentiation of industries are done…
Q: It is proposed to place cable on an existing pole line along the shore of a lake to
A: Equivalent annual cost or EAC is defined as the annual cost of owning, operations and maintenance of…
Q: Which of the following is NOT a component of the Multidimensional Poverty Index? Whether or not the…
A: To provide a more detailed examination of the amount of poverty and hardship, multidimensional…
Q: Mr. Lee wishes to establish a perpetual trust to provide for the maintenance of a small local…
A: given that, the annual maintenance is P 180, 000 per year the trust account can earn 6% interest,…
Q: Consider the following Purchasing Power Parity (PPP) conversion rate for selected countrie in 2021.…
A: According to PPP conversion table, One USD is equal to 4738.64 Indonesia currency i.e., 1 USD =…
Q: Identify five (5) areas of the economy where the influence of the 4IR was either positive, negative…
A: Industrial Revolution The industrial revolution refers to the up-gradation of Industries and…
Q: You are scheduling production of your popular Rustic Coffee Table. The table requires a top, four…
A: MRP usually stands for material requirements planning, and it is a method that assists manufacturers…
Q: 2. Fill in the table Costs of Production of a Soap Manufacturer Bar of Total Total Average Average…
A: Introduction We have given data related to the cost of the soap manufacturer. We have given total…
Q: 2. Fill in the table Bar of Total Soap Fixed (Quantity) Cost 100 P1,000 200 1,000 300 1,000 400…
A: We use the following formulas to fill the above table: 1) Total Cost = Total Fixed Cost + Total…
Q: “Conflicts in Russia and Ukraine are likely to affect how much wheat is available for purchase in…
A: Supply shock is situation where there is sudden increase or decrease in availability of goods more…
Q: explain the implications of the aspect you chose for public management? public financing and…
A: Public finance is the method of managing the public funds in the country’s economy that recreates…
Q: For the following calculations the tax threshold is $1,500,000 and the taxable income is taxed at…
A: Income tax is a type of direct tax levied by a government on the earnings of its citizens.…
Q: If the government imposes an MC-pricing scheme on the natural monopolist, the government may need to…
A: In different types of market, cost and revenue functions are different based on market condition and…
Q: &ll by adding 5 to each of the numbers in the set 36117 5 t we obtain the set 8, 11 , 6 , 12, 10…
A: The athematic mean is a method used to calculate the average value of data. Because it is a method…
Q: There is much evidence that large firms with considerable market power (firms such as monopolies)…
A: producer equilibrium is the situation where firm produces the efficient level of output that…
Q: 4. Let money demand, (M/P)d-0.6Y/i.' a. Calculate the velocity of money when the nominal interest…
A: In macroeconomics, the money deliver refers to the total quantity of currency held via way of means…
Q: Suppose w = 5 and the government gives Anne a subsidy of $150. She receives this money…
A: A kink is a point where the linearity of the budget line or any other line breaks.
Q: Should free agency change the allocation of players across team? Will this effect competitive…
A: Athletes at the zenith of their careers may utilize free agency to shop themselves around to…
Q: Subject: Manegerial economics & policy Q#1) Explain the distinction made in economic analysis…
A: Economic analysis aids charities and their funders in weighing the impact of a social intervention…
Q: he Central Bank requires banks to maintain a 10% legal minimum reserve requirement of their…
A: Money supply is the total stock of money in the circulation . and there are various money supply…
Q: Hand written plz If marginal revenue is -0.00521392 and the cost per unit is 1.8, how much do…
A: The fundamental goal of the firm is to maximize profits. However, certain costs are incurred in the…
Q: There are three countries in the world: Country A, Country B, and Country C. These countries have…
A: Country A:- demand=DA=400-10PA supply=30PA Country B:- demand=DB=320-40PB supply=40PB Country C:-…
Q: Disaggregation on inputs was introduced in the capital market as economic growth models became more…
A: Economic Growth Economic growth refers to the increment in the economic factors of the economy of a…
Q: Problem 4 Let G be the number of hours of police patrolling in a community. Consider three…
A: Answer -
Q: For the three-part question that follows, provide your answer to each question in the given…
A: Savings is the practice of putting aside a portion of one's current income for future use, or the…
Q: TRUE or FALSE Question: Many airlines have stopped all international flights and 70% of domestic…
A: A dynamic cycle is a progression of steps taken by a person to decide the most ideal choice or…
Q: 2. The Daisy-land's economy is described as follows: Y=C+I+G; Y=10,000; G=2,000; T-3,000;…
A: Private saving is the total amount of savings done by the private (financial and non-financial)…
Q: computerized wood lathe, costing P25,000, will be used to make ornamental parts for sale. Receipts…
A: Cost of computerized wood lathe = $25000 Life of equipment = 10 years Salvage value of equipment =…
Q: The human wants for goods, services and resources exceed what is available, is known as
A: Economics study how the limited resources should be allocated to satisfy unlimited human wants in an…
Q: As an additional safety measure for online transactions, several credit card companies now supply…
A: Visa/Mastercard: It's a small rectangular piece of plastic or metal issued by financial institutions…
Q: Price, cost, revenue $100 $90 $80 $70 $60 $50 0000 MC MR D 0 7000 14000 21000 12000 Dresses per year…
A: "Monopolistically competitive industry consists of many firms which sell commodities or services…
Please only send solutions to question D and E
Thanks in advance
Trending now
This is a popular solution!
Step by step
Solved in 2 steps
- A consumer's current income (y) is 200 and the future income ( t.') is 240. A current lump sum tax (t) of 10 is paid and the tax in the next period (t') is 15. The real interest rate is 20% for each period. Please assume that current and future consumption are complements. and the consumer always prefers to have one unit of current consumption and two units of consumption in the future.Calculate the consumer's lifetime wealth.Calculate the optimal current and future consumption and the optimal current and future savings. Is the consumer a lender or a borrower? How does he she. as a lender or a borrower. affect the future consumption?A consumer's current income (y) is 200 and the future income ( t.') is 240. A current lump sum tax (t) of 10 is paid and the tax in the next period (t) is 15. The real interest rate is 20% for each period. Please assume that current and future consumption are complements. and the consumer always prefers to have one unit of current consumption and two units of consumption in the future. Calculate the optimal current and future consumption and the optimal current and future savings. Is the consumer a lender or a borrower? How does he she. as a lender or a borrower. affect the future consumption?Suppose that a person can borrow and lend at an interest rate of 10 percent. But there is a 5% rate of inflation and one has to pay an income tax of 30 % on all interest income. If you borrow money, you can deduct interest as an expense. Where current consumption is on the horizontal axis and future consumption is on the vertical axis: (a) the budget line will have a kink at the point of no saving or lending. (b) the budget line will be a straight line with a slope of about 1: 02. (c) the budget line will be a straight line with a slope of about 1:05. (d) the budget line will be a straight line with a slope of about 1:35.
- Consider a two-period consumption saving model and let f1 and f2 denote the first and secondperiod consumption, respectively. Assume that the interest rate at which the consumer may lend or borrowis 10%. Suppose that a consumer’s utility function is x (f1> f2) = f1 + 20√f2= The consumer first periodincome is L1 = $100 and the present value of her income stream is $330=(a) What is the optimal consumption stream (consumption bundle) of this consumer?(b) Is this consumer borrower or lender? How much does she borrow or lend?(c) What is the effect of a reduction of the interest rate to 5% on the consumer’s optimal first-periodsaving? (Make sure to take into account the effect of the decline in the interest rate on the present value ofthe consumer’s income stream.)Assume an economy with 1000 consumers. Each consumer has income in the current period of 50 units and future income of 60 units, and pays a lump-sum tax of 10 in the current period and 20 in the future period. The market real interest rate is 8%. Of the 1000 consumers, 500 consume 60 units in the future, while 500 consume 20 units in the future. a) Determine each consumer's current consumption and current saving. b) Determine aggregate private saving, aggregate consumption in each period, government spending in the current and future periods, the current-period government deficit, of the quantity of debt issued by the government in the current period. c) Suppose that current taxes increase to 15 for each consumer. Repeat parts (a) and (b) and explain your results.Optimizing economic agents use the real interest rate when thinking about the economic costs and returns of a loan. Suppose the average rate paid by banks on savings accounts is 0.75% at a time when inflation is around 1.65%. For the average saver, the real rate of interest on his or her savings is .......???%. (Round your response to two decimal places and use a minus sign if necessary.) If banks expect that the rate of inflation in the coming year will be 4.65% and they want a real return of 7.5% on a certain category of loans, then the nominal rate they should charge borrowers on those loans is .......???%. (Round your response to two decimal places.) If the economy experiences an unexpectedly low rate of inflation, the group that would tend to benefit is ___________. A. debtors (people or businesses who owe money). B. creditors (people or institutions that are owed money). C. both would benefit equally. D. neither benefits.
- #3 . Assume an economy with 1000 consumers. Each consumer has income in the current period of 50 units and future income of 60 units, and pays a lump-sum tax of 10 in the current period and 20 in the future period. The market real interest rate is 8%. Of the 1000 consumers, 500 consume 60 units in the future, while 500 consume 20 units in the future. (a) Determine each consumer’s current consumption and current saving. (b) Determine aggregate private saving, aggregate consumption in each period, government spending in the current and future periods, the current-period government deficit, and the quantity of debt issued by the government in the current period.Suppose Alice faces the following prices and income across two periods. Prices Income Period 10 200 1 Period 12 2 250 Suppose the interest rate is 5%. Using the equation editor, write down the intertemporal budget constraint for Alice.Saving in the economy Multiple Choice Occurs when current spending is less than current incomes. and investment are essentially the same concept. Occurs when current consumption is more than current output. is generally not a determinant of future output.
- Question 2: Consider a consumer who lives for two periods. The consumer's current- period income is y, future-period income is y' and y> y'. The consumer considers the current- period consumption (c) and future-period consumption (c') to be perfect complements. The consumer also likes to perfectly smooth consumption over time, i.e. c = c'. The consumer faces a borrowing rate (r) that is higher than the lending rate (r). There is no limits on borrowing or lending. 1. Draw a diagram with c on horizontal axis and c' on vertical axis. Draw the consumer's budget constraint and indifference curves. Show the equilibrium. Is the consumer a borrower on a lender? Briefly explain. 2. The government introduces fully-funded social security. The consumer is required to contribute t to the consumer's social security account with the government. The gov- ernment promises to pay b in benefits in the next period, where b = t(1+r). The size of the social security contributions is such that y − tIn Irving Fisher’s two period model, if the consumer is initially a saver and the interestrate and the first period consumption increases, then we can conclude that the incomeeffect:a) Was greater than the substitution effectb) Was less than substitution effectc) Exact offset the substitution effectd) And the substitution effect both increased consumptionBill's income is $1,000 and his net taxes are $350. His disposable income is Group of answer choices $650. $750. $1,350. -$350.SEE MORE QUESTIONS