In Irving Fisher's Two-Period Consumption Model, If Y₁ = 20,000

question 104

Multiple Choice

In Irving Fisher's two-period consumption model, if Y₁ = 20,000, Y₂ = 15,000, and the interest rate r is 0.50 (50 percent) , then the maximum possible consumption in period two is:

• A) 15,000.
• B) 25,000.
• C) 35,000.
• D) 45,000.

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