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You Have $20,000 of Current Income and $45,000 of Future

Question 20

Multiple Choice

You have $20,000 of current income and $45,000 of future income. The interest rate between the current and future period is 2 percent. When you allocate consumption optimally between the two periods the marginal rate of time preference between the two periods is


A) -1.02.
B) -1.00.
C) -1.80.
D) 0.80.

Correct Answer:

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