Exam 9: Intertemporal Choice-Part B

Harvey Habit has a utility function U(c₁, c₂)= min{c₁, c₂}.If he had an income of $1,290 in period 1 and $860 in period 2 and if the interest rate were 15%, how much would Harvey choose to spend on bread in period 1?

Patience has a utility function U(c₁, c₂)= c^1/2₁ + .083c^1/2₂, where c₁ is her consumption in period 1 and c₂ is her consumption in period 2.Her income in period 1 is 3 times as large as her income in period 2.At what interest rate will she choose to consume the same amount in period 1 as in period 2?

Suppose that Molly had an income of $500 in period 1 and an income of $250 in period 2.Suppose that her utility function were c^a₁c^1-a₂, where a = 0.60 and the interest rate were 25%.If her income in period 1 doubled and her income in period 2 stayed the same, her consumption in period 1 would

In the village if the harvest this year is 6,000 bushels of grain and the harvest next year will be 900 bushels and if rats eat 10% of any grain that is stored for a year, how many bushels of grain could the villagers consume next year if they consume 1,000 bushels of grain this year?

Harvey Habit has a utility function U(c₁, c₂)= min{c₁, c₂}.If he had an income of $645 in period 1 and $1,290 in period 2 and if the interest rate were 15%, how much would Harvey choose to spend on bread in period 1?

Harvey Habit has a utility function U(c₁, c₂)= min{c₁, c₂}.If he had an income of $420 in period 1 and $1,050 in period 2 and if the interest rate were 10%, how much would Harvey choose to spend on bread in period 1?

If Peregrine consumes (1, 400, 1, 210)and earns (900, 1, 760)and if the interest rate is 10%, the present value of his endowment is

In the village, if the harvest this year is 4,000 bushels of grain and the harvest next year will be 1,200 bushels and if rats eat 50% of any grain that is stored for a year, how many bushels of grain could the villagers consume next year if they consume 1,000 bushels of grain this year?

Suppose that Molly had an income of $500 in period 1 and an income of $880 in period 2.Suppose that her utility function were c^a₁c^1-a₂, where a = 0.60 and the interest rate were 10%.If her income in period 1 doubled and her income in period 2 stayed the same, her consumption in period 1 would

Suppose that Molly had an income of $600 in period 1 and an income of $880 in period 2.Suppose that her utility function were c^a₁c^1-a₂, where a = 0.80 and the interest rate were 10%.If her income in period 1 doubled and her income in period 2 stayed the same, her consumption in period 1 would

Suppose that Molly had an income of $200 in period 1 and an income of $460 in period 2.Suppose that her utility function were c^a₁c^1-a₂, where a = 0.40 and the interest rate were 15%.If her income in period 1 doubled and her income in period 2 stayed the same, her consumption in period 1 would