1. Khademul is very frugal and is currently saving lots of money in the hope of funding a higher lifestyle in the future. If the interest rate falls, will Khademul change his lifestyle enough to start spending more than his income? Will he become better or worse off? Explain. 2. Suppose that instead of seeing a change in the interest rate, Khademul experiences a substantial increase in his income. How would this affect his lifestyle? Would he be better off or worse off