Question
Mr. Fox has zero savings, $120 income this year and zero income next year. The market interest rate is 10 percent per year. Mr. Fox
Mr. Fox has zero savings, $120 income this year and zero income next year. The market interest rate is 10 percent per year. Mr. Fox also has an investment opportunity in which he can invest $60 today and receive $80 next year. Suppose Mr. Fox consumes $50 this year, invests in the project and earns market interest rate on the remaining money. What will be his maximum consumption next year? Write just the number.
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