Ophelia has income of M1 = 100 in period 1 and M2 = 20 in period 2. If she chooses to, she can either save or borrow at an interest rate of i = 0.05 (so an interest rate of 5% per period). The rate of price inflation between periods is 7 = 0 (so a 0% inflation rate) and the price of a unit of consumption in each period is normalized to 1 (so p1 = p2 = 1). Which of the following is a correct equation for the budget line that describes intertemporal consumption bundles that are exactly affordable to Ophelia? O C2 = 125 - C1 O C2 = 120 - 1.05c1 O C2 = 120 - C1 O C2 = 125 - 1.05c1Now suppose that Ophelia has income of M1 = 20 in period 1 and M2 = 100 in period 2. (Notice that the values of the income flows in the two periods are reversed compared with the previous questions.) In every other way, the scenario is the same as before: (i) if Ophelia chooses to, she can either save or borrow at an interest rate of i = 0.05 (so an interest rate of 5% per period); (ii) the rate of price ination between periods is 71' = 0 (so a 0% ination rate) and price of a unit of consumption in each period is normalized to 1 (so p1 : p2 : 1); and (iii) Ophelia's utility function over intertemporal consumption bundles is U(cl , (:2) = 11161 l 11102. Which of the following statements accurately describes how Ophelia's utility-maximizing behavior is affected by the change in which income flow comes when? Ophelia's utility-maximizing bundle is the same as in the original problem and Ophelia is now a borrower in the rst period. Ophelia's utility-maximizing bundle is different than in the original problem and Ophelia is now a borrower in the rst period. Ophelia's utility-maximizing bundle is different than in the original problem and Ophelia is now a saver in the rst period. Ophelia's utility-maximizing bundle is the same as in the original problem and Ophelia is now a saver in the rst period