Question: Hi can u help me solve this please im struggling, thank you! Anna cares about her present and future consumption. Anna prefers consumption plan A
Hi can u help me solve this please im struggling, thank you!
Anna cares about her present and future consumption. Anna prefers consumption plan A to consumption plan B if and only if plan A provides Anna with a larger lifetime (aggregate) consumption than plan B:
| a. | Present and future consumption are perfect complements for Anna | |
| b. | If the interest rate is positive, Anna will save all her present income | |
| c. | If the interest rate is positive, an increase in the interest rate will increase Anna's savings | |
| d. | Anna neither saves nor borrows, for any interest rate | |
| e. | If the interest rate is positive, an increase in the interest rate will increase Anna's present consumption |
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