Consider a two period model of consumption and savings. An individual earns an income of $100.00 in period 0, and will have an income of $125.00 in period 1. One consumption possibility for this individual is to consume $40.00 in period 0, and $192.50 in period 1. Given this information.

a) What is the interest rate? (2 pts)

b) How much will the individual consume in period 0 and in period 1 if they want to consume five times as much in period 0 as in period 1. (6 pts)