Consider a Two-Year Period Where a Consumer Has an Income

Multiple Choice

Consider a two-year period where a consumer has an income of $10,000 in year 1 and $8,000 in year 2.The consumer can borrow or lend at a rate of 10 percent.If the consumer decides to save $1,000 in year 1,it means:

A) his consumption will be equal in both years.
B) he will have a higher consumption in year 2 than in year 1.
C) he considers consumption in year 1 as an inferior good.
D) the cost of future consumption will increase.