Consider a twoperiod economy populated by two different individuals. Individual A's lifetime utility is sci,\" + sat\". while that of individual E is Individuals can save or borrow by buying or selling a riskless discount bond in period I] which pays one unit of consumption in period 1. Bonds trade at prioe u in period 1:}. Aggregate inoome is 111 in period I] and 15 in period 1. It is unequally divided; Individual A earns all the income in period El while individual E earns all the income in period 1. a) Which of the two individual has a. stronger desire to smooth consumption over time\"? Explain. b] Which of the two individual has a. stronger preferenoe for period G's consumption? Explain. c) Write down individual A's problem and characterize his optimal savingfborrowing decisions by comparing the cost and benefits of trading bonds (i.e. nd of for A). You may need to use the appropriate appendix table or technology to answer this question. Suppose In 2018, RAND Corporation researchers found that 77% of all individuals ages 66 to 65 are adequately prepared financially for retirement, Many financial planners have expressed concern that a smaller percentage of those in this age group who did not complete high school are adequately prepared financially for retirement. (a) Develop appropriate hypotheses such that rejection of N, will support the conclusion that the proportion of those who are adequately prepared financially for retirement is smaller for people in the 66-69 age group who did not complete high school than it is for the population of the 66-69 year old. (Enter In for a as needed.} (b) In a random sample of 300 people from the 65-69 age group who did not complete high school, 159 were not prepared financially for retirement. What is the p- value for your hypothesis test? Find the value of the test statistic. (Round your answer to two decimal places.) Find the p-value. (Round your answer to four decimal places.) p-value = (c] At a = 0.01, what is your conclusion? Do not reject He. We conclude that the percentage of 66- to 69-year-old individuals who are adequately prepared financially for retirement is smaller for those who did not complete high school. Reject Ho. We conclude that the percentage of 66- to 69-year-old individuals who are adequately prepared financially for retirement is smaller for those who did not complete high school. Reject Ho. We cannot conclude that the percentage of 66- to 69-year-old individuals who are adequately prepared financially for retirement is smaller for those who did not complete high school. Do not reject H,. We cannot conclude that the percentage of 66- to 69-vear-old individuals who are adequately pranarad financially far vaticanIn] 11. Ll'U'UKJIldIIKJ 5-1 Jackson Corporation's bonds have 12 years remaining to maturity. Interest is paid annually, the ponds have a $1000 par value, and the coupon interest rate is 8%. The bonds have a yield to maturity of 9%. What is the current market price of these bonds? 5-2 While Wonders's oonds have 12 years remaining to maturity. Interest is paid annuatly, the bonds have a $1,000 par value, and the coupon interest rate is 10%. The bonds sell at a price of $850. What is their yield to maturity. 5-3 Health Foods's bonds have T years remaining to maturity. The bonds have a face 1iralue of $1,000 and a yield to maturity of 8%. They pay interest annually and have a 9% coupon rate. What is their current yield? 5-? Renfro Renters has issued Bonds that have a 10% coupon rate, payable semiannually. The bonds mature in 3 years, have 2 face value of $1000, and a yield to maturity of 8.5%. What is the price of the bonds\"?I 5-8 Thatcher Corporation's bonds will mature in 10 years. The bonds have a face value of $1000 and an 8% coupon rate, paid semiannuatiy. The price cfthe bonds is $1100. The bonds are callable in 5 years at a call price of $1050. What is their yield to maturity? What is their yield to call