Answered step by step
Verified Expert Solution
Question
1 Approved Answer
Suppose that currently the government is spending G=100 and G=113, with current taxes T=94. How much does the government have to borrow, B ? Question
Suppose that currently the government is spending G=100 and G=113, with current taxes T=94. How much does the government have to borrow, B ? Question 2 10 pts Suppose that currently the government is spending G=100 and G=116, with current taxes T=92. If the interest rate is 0.05, what is the value of future taxes, T (to the nearest 2 decimal places)? Consumers with a higher discount factor (that is, higher ) would be expected to save more and consume less in the current period relative to a consumer with a lower discount factor. True False Question 4 10 pts We know that the consumer has c=90,c=111,w=10,h=24,l=10,l=10. If r=0.1, what is savings, s ? Next, what is the value of future wages, w that make this budget correct? Explain how a change in the real interest rate, r, affects the consumer's choice of current consumption, c and future consumption, c. Does it matter if the consumer is currently a saver or borrower? If so, explain how
Step by Step Solution
There are 3 Steps involved in it
Step: 1
Get Instant Access with AI-Powered Solutions
See step-by-step solutions with expert insights and AI powered tools for academic success
Step: 2
Step: 3
Ace Your Homework with AI
Get the answers you need in no time with our AI-driven, step-by-step assistance
Get Started