In Irving Fisher's Two-Period Model Augmented by a Borrowing Constraint

question 89

Multiple Choice

In Irving Fisher's two-period model augmented by a borrowing constraint, an example of a consumer for whom the borrowing constraint might likely be binding would be:

• A) a college student.
• B) a college student's parent.
• C) a college professor.
• D) the president of a bank.

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Definitions:

Decreasing Slope

A downward trend on a graph indicating that one variable decreases as another variable increases.

Risk-loving

A preference for options with uncertain outcomes, even when the expected return is the same as safer alternatives.

Universal Health Coverage

A health care system in which all individuals have access to quality health services without suffering financial hardship.

Lemon Laws

Laws designed to offer remedies to consumers for products such as automobiles that repeatedly fail to meet standards of quality and performance.