Refer to the figure below. The intercept point N is found by I1 + I0(1 + r). The intercept point M is calculated by I0 + I1/(1 + r). Show that the slope of the budget constraint is indeed .

Question

Refer to the figure below. The intercept point N is found by I1 + I0(1 + r). The intercept point M is calculated by I0 + I1/(1 + r). Show that the slope of the budget constraint is indeed  .

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The Answer of Refer to the figure below. The intercept point N is found by I1 + I0(1 + r). The intercept point M is calculated by I0 + I1/(1 + r). Show that the slope of the budget constraint is indeed  .

Refer to the Figure Below