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Next Year $3,600 - Now $3,000 A Refer to the above graph. The solid sloping line represents the opportunities for investment in the capital market.

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Next Year $3,600 - Now $3,000 A Refer to the above graph. The solid sloping line represents the opportunities for investment in the capital market. Suppose Casper Smith has $3,000 now available to support consumption in periods 0 (now) and 1 (next year). Suppose Casper is given an opportunity to invest up to $3,000 at 32% risk-free in his friend startup business. Casper wants to consume exactly the same amount in each period. How much can he consume this period and next period? (Keep your answer to only two decimals) a. What is the market interest rate ? (example of answer format: 18.42%) b. How much will he consume this period ? (example of answer format: $1,000.00 or 1,000.00) Next Year $3,600 - Now $3,000 A Refer to the above graph. The solid sloping line represents the opportunities for investment in the capital market. Suppose Casper Smith has $3,000 now available to support consumption in periods 0 (now) and 1 (next year). Suppose Casper is given an opportunity to invest up to $3,000 at 32% risk-free in his friend startup business. Casper wants to consume exactly the same amount in each period. How much can he consume this period and next period? (Keep your answer to only two decimals) a. What is the market interest rate ? (example of answer format: 18.42%) b. How much will he consume this period ? (example of answer format: $1,000.00 or 1,000.00)

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