Question: 3. Consider two savings accounts that pay the same interest rate. One account lets you take your money out on demand. The second requires that

3. Consider two savings accounts that pay the same interest rate. One account lets you take your money out on demand. The second requires that you give 30-day advance notification before withdrawals.(10MARKS)

a. Which account would you prefer? Why?

b. Can you imagine a person who might make the opposite choice? Explain.

c. What do these choices say about the theories of the consumption function

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