The next questions refer to the following.
An individual is endowed with $100 of income in period 1, and will receive an income of 121 in period 2. The interest rate is 10%, and there are only 2 periods.
-The maximum first period consumption consistent with the intertemporal budget constraint is
A) 100
B) 110
C) 121
D) 210
E) 221

Question

Quizplus · Accepted Answer

The Answer of The next questions refer to the following.
An individual is endowed with $100 of income in period 1, and will receive an income of 121 in period 2. The interest rate is 10%, and there are only 2 periods.
-The maximum first period consumption consistent with the intertemporal budget constraint is
A) 100
B) 110
C) 121
D) 210
E) 221

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