Two-period model, Macroeconomics

Assignment Help:
Suppose that a household in a two-period model has income of $30,000 in period 1 and $25,000 in period 2, and the interest rate is 75 percent. Assume that the price of the good is $1 in boh periods. Suppose that the household decides to consume 26,000 in period 1 and 32,000 in period 2. Now suppose that the interest rate falls 50 percent, and the household decides not to borrow or lend at all. Is the household better off or worse off with the higher interest rate?

Related Discussions:- Two-period model

Perfectly competitive firm, Consider the following demand schedule. Does it...

Consider the following demand schedule. Does it apply to a perfectly competitive firm? Compute marginal and average revenue Price Quantity Price Quantity $95 2 $55 5 $88 3 $40 6 $

Application of revealed preference approach, Application of Revealed Prefer...

Application of Revealed Preference Approach It has been strongly argued, especially by Sir John Hicks, that one major advantage of revealed preference theory is that it is expl

What are the types of market economies, There are 4 main types of market ec...

There are 4 main types of market economies. They are also called as Economic Systems. The four are Free Market, Mixed Market, Traditional and Command Economy

National income determination, impact of change in government expenditure a...

impact of change in government expenditure and tax on fiscal policy

About assignment, i have assignment due within less than 24 hours if i sub...

i have assignment due within less than 24 hours if i submit assignment can i get it back before 24 hours?

Command economy, define history and full deatil of command economy

define history and full deatil of command economy

Kind of organization, Informal groups exist in almost every kind of organiz...

Informal groups exist in almost every kind of organization. Answer the following questions and provide examples to support your position: • What types of informal groups do you

Employment and inflation , With the aid of a diagram explain the Philip''s ...

With the aid of a diagram explain the Philip''s curve

Mec, Lucas’ point of view, what are the limitations of the Keynesian model?...

Lucas’ point of view, what are the limitations of the Keynesian model? What improvements does he suggest?

Budget balanced, Given a four sector economy how do you find the budget bal...

Given a four sector economy how do you find the budget balanced

Write Your Message!

Captcha
Free Assignment Quote

Assured A++ Grade

Get guaranteed satisfaction & time on delivery in every assignment order you paid with us! We ensure premium quality solution document along with free turntin report!

All rights reserved! Copyrights ©2019-2020 ExpertsMind IT Educational Pvt Ltd