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assume you can lend and borrow at 6% and have 15000 in income in each of the two periods. further assume you currently have savings
assume you can lend and borrow at 6% and have 15000 in income in each of the two periods. further assume you currently have savings of 30000 from before;
1) if you decide to spend nothing in the next period, how much can you spend today?
2) if you decide to spend nothing today, how much can you spend in the next period?
3) the graph of the opportunity set for consumption across the two time periods will have which shape; ellipse, parabola, straight line, hyperbola?
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