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There is no borrowing constraint, but the saving interest rate is rs = 5%, and the borrowing rate rb = 10%. Assuming that income is
There is no borrowing constraint, but the saving interest rate is rs = 5%, and the borrowing rate rb = 10%. Assuming that income is $200 in each of two periods, the most that an agent can consume in the second period is closest to:
a. 370
b. 390
c. 410
d. 430
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