Question: Trying to study for a test! I want to know how to calculate each answer with the graph. Thank you! Questions 1-7 refer to the


Questions 1-7 refer to the diagram below. Suppose that preferences for Josh are depicted in the graph between consumption today on the X-axis and consumption tomorrow on the Y- axis 32 30 28 26 24 22 20 18 16 114 12 10 8 6 4 2 ON 0 2 4 6 8 10 12 14 16 18 20 22 24 26 28 30 32 1. Suppose the interest rate is 100%. Josh receives $6 in income today and $4 in income tomorrow. What is the present value of the Josh's income? a. $4 b. $6 c. $8 d. $10 e. $12 2. If Josh spent all his money today, how much money could he spend? a. $4 b. $6 c. $8 d. $10 e. $12 3. What is the slope of Josh's budget line? a. -0.5 b. -0.9 C. -1 d. -1.5 e-2 4. Given Josh's preferences, how much money does he spend today and tomorrow? a. $6 today, $4 tomorrow b. $10 today, $o tomorrow c. So today, $10 tomorrow d. $6 today, $6 tomorrow e. $4 today, $8 tomorrow 5. Now suppose the interest rate is 0%. Josh receives $12 today and $4 tomorrow. What is the present value of Josh's income? a $8 b. $10 C. $12 d. $14 e. $16 6. Given Josh's preferences, how much does he spend today and tomorrow? a $6 today, $4 tomorrow b. $8 today, $8 tomorrow C. $10 today, $5 tomorrow d. $12 today, $4 tomorrow e. $4 today, $8 tomorrow 7. Now suppose that Josh cannot borrow because of a borrowing constraint. How much does he spend today and tomorrow? a. $6 today, $4 tomorrow Questions 1-7 refer to the diagram below. Suppose that preferences for Josh are depicted in the graph between consumption today on the X-axis and consumption tomorrow on the Y- axis 32 30 28 26 24 22 20 18 16 114 12 10 8 6 4 2 ON 0 2 4 6 8 10 12 14 16 18 20 22 24 26 28 30 32 1. Suppose the interest rate is 100%. Josh receives $6 in income today and $4 in income tomorrow. What is the present value of the Josh's income? a. $4 b. $6 c. $8 d. $10 e. $12 2. If Josh spent all his money today, how much money could he spend? a. $4 b. $6 c. $8 d. $10 e. $12 3. What is the slope of Josh's budget line? a. -0.5 b. -0.9 C. -1 d. -1.5 e-2 4. Given Josh's preferences, how much money does he spend today and tomorrow? a. $6 today, $4 tomorrow b. $10 today, $o tomorrow c. So today, $10 tomorrow d. $6 today, $6 tomorrow e. $4 today, $8 tomorrow 5. Now suppose the interest rate is 0%. Josh receives $12 today and $4 tomorrow. What is the present value of Josh's income? a $8 b. $10 C. $12 d. $14 e. $16 6. Given Josh's preferences, how much does he spend today and tomorrow? a $6 today, $4 tomorrow b. $8 today, $8 tomorrow C. $10 today, $5 tomorrow d. $12 today, $4 tomorrow e. $4 today, $8 tomorrow 7. Now suppose that Josh cannot borrow because of a borrowing constraint. How much does he spend today and tomorrow? a. $6 today, $4 tomorrow
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