Consider three-period model of household choice

Assignment Help Business Economics

Reference no: EM131424820

Consider a three-period model of household choice. The real interest rate is 4 percent. A household wants to have $10,000 available for consumption during last period of life (retirement). Using the household’s wealth constraint, how much does it have to save in the second period when its income is $65,000 and it saves $5,000 in the first (current) period?

Reference no: EM131424820

Questions Cloud

In what ways does gossip sometimes function : Is there a "downside' to having face concerns addressed by someone not directly involved in the conflict? In what ways does "gossip" sometimes function as an attempt to receive face support?

What are the major obstacles to global regulation : How do global regulations influence businesses operating internationally? What are the major obstacles to global regulation? Compare the costs and benefits of regulation. In your opinion, do the benefits outweigh the costs? What are the advantages an..

Homeowner can afford to spend for a geothermal heat pump : A geothermal heat pump can save up to 80% of the annual heating and cooling bills of a certain home in the northeastern U.S. In this region, the yearly cost of conventionally heating and cooling a 2,000 square foot house is about $2, 500. The maximum..

Increasing returns to scale occurs when firms : Increasing returns to scale occurs when a firm's: Which of the following is NOT an assumption of monopolistic competition? Which of the following is NOT a reason for Canada to join NAFTA? Which of the following is the calculation that tells us the pr..

Consider three-period model of household choice : Consider a three-period model of household choice. The real interest rate is 4 percent. A household wants to have $10,000 available for consumption during last period of life (retirement). Using the household’s wealth constraint, how much does it hav..

Meaning of the consumers marginal rate of substitution : Write a one sentence explanation of the meaning of the consumer's marginal rate of substitution (MRS) at the optimal consumption bundle. Include the numerical value of the MRS in the sentence.

Consumer with preferences and budget constraint : Consider a consumer with the following preferences and budget constraint: graph the budget constraint and some of the consumer's indifference curves on a graph. Be sure to cleary label the axes, slopes and intercepts.

Detailed evaluation of the ethical considerations associated : A detailed evaluation of the ethical considerations associated with the television technology in relation to its impact on humanity. Please include a reference.

Medical insurance are treated for tax purposes : Harold works for the Zanten Corporation. Ken is self-employed. Zanten pays all of Harold’s medical insurance premiums, whereas Ken purchases medical insurance from his insurance agent. Explain how the payments of Ken’s and Harold’s medical insurance ..

User Account

All Pages