15) If the government sends checks paying $ 2,000.00 to middle and upper-middle-class earning yearly up to $ 150,000.00, then the following consequences arise: A) Wealth of recipients increases. B) Most of the money is saved. C) Consumption in the present rises marginally. D) Savings today are used to finance consumption in the future. E) All of the above. IT (A sh to eno (a agid h Poaing i1 (01
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- Explain how does adecrease in the current income y affect the consumer’s consumption-saving decision. In particular,explain: 1) How will current consumption c, future consumption c′, and savings s change; 2) Arethere any substitution effect or income effect. Make sure you draw two figures, one for the borrowersand one for the lendershich theory of consumption best explains the consumption behavior of consumers of our economy? Question No: 02 [Marks: 10] If the State Bank started printing large quantities of Pakistani Rupees (Rs), what would happen to the number of Pakistani Rupees a dollar could buy? Why? Question No: 03 [Marks: 10] Deseribe the difference batuuean foreian diract investmet and foraion nortfolie invastment Who is mora likelu to1. a. Explain consumption and saving function by using numerical example and diagram.
- Because of scarcity, people are more likely to do what? squander resources increase the profit margin use resources wisely The MOST important factor affecting consumer spending is O the level of current consumer debt O the amount of assets held by consumers such as homes, cars, stocks, or bonds the expectations of consumers of what the economy will be in the future © the level of current consumer incomeAn individual lives for 5 years - 4 years of work followed by 1 year of retirement. He earns $25,000 during each year of work but $0 during retirement. The interest rate is 5% Assume that the individual wants his consumption to be the same in each of the 5 years. a. What utility function would justify this choice of consumption pattern? b. Write out the intertemporal budget constraint in present value form.c. What level of consumption does he choose?d. What is the value of his assets at the beginning of retirement?What are the nonincome determinants of Consumption and Savings?
- Question 4 Explain how does a decrease in the current income y affect the consumer's consumption-saving decision. In particular, explain: 1) How will current consumption c, future consumption c', and savings s change; 2) Are there any substitution effect or income effect. Make sure you draw two figures, one for the borrowers and one for the lenders.Suppose that a person can borrow and lend at an interest rate of 10 percent. But there is a 5% rate of inflation and one has to pay an income tax of 30 % on all interest income. If you borrow money, you can deduct interest as an expense. Where current consumption is on the horizontal axis and future consumption is on the vertical axis: (a) the budget line will have a kink at the point of no saving or lending. (b) the budget line will be a straight line with a slope of about 1: 02. (c) the budget line will be a straight line with a slope of about 1:05. (d) the budget line will be a straight line with a slope of about 1:35.8. Based on the following wealth utilization, what is the best rank of prioritization in consumption recognized in Islam: i Your close friend who is poor and in need ii Your sister who needs to do medical surgery iii Donation to a charity foundation iv Contributed to the construction of Maahad Tahfiz i, ii, iv, iii ii, i, iii, iv i, ii, iii, iv ii, i, iv, iii
- 3. Suppose we are in a society where the social rate of time preference is 5% per year. The discount rate of utility is 3.5% per year, and the elasticity of marginal utility of consumption is 1.25. A. What is the assumed growth rate of future consumption under this scenario? B. Now assume the social rate of time preference changes to 10% while all else stays the same. What is the assumed new growth rate of future consumption? C. What does a SRTP of 5% mean compared to a SRTP of 10%? D. Why does the growth rate of future consumption change from one scenario to the other? ( If you Answer allow the above I will upvot definitely . ) Thank you3. Suppose we are in a society where the social rate of time preference is 5% per year. The discount rate of utility is 3.5% per year, and the elasticity of marginal utility of consumption is 1.25. A. What is the assumed growth rate of future consumption under this scenario? B. Now assume the social rate of time preference changes to 10% while all else stays the same. What is the assumed new growth rate of future consumption? C. What does a SRTP of 5% mean compared to a SRTP of 10%? D. Why does the growth rate of future consumption change from one scenario to the other? Answer C & DAfter grauating with a BBA in Economics, Dwight is considering going to college to get a Ph. D. in Economics. If he does not go to graduate school to get a Ph. D. in Economics, he will be earning $112483 working at Bank of America, and spend $44134 on room and board. If he goes to college to get a Ph. D. in Economics, he will spend $43012 on tuition, $20376 on room and board, and $7550 on books. What are Dwight's full cost of getting a Ph. D. in Economics? Only typing answer Please explain step by step