If we represents a two-period consumer's lifetime wealth and $r$ denotes the real rate of interest, the slope of the consumer's budget line is equal to
A) $- \frac { 1 } { ( 1 + r ) }$.
B) $- \frac { r } { ( 1 + w e ) }$.
C) $r ( 1 + w e )$.
D) $r \times$ we.
E) $- ( 1 + r )$.

Question

Quizplus · Accepted Answer

The slope of the consumer's budget line in a two-period model is $- (1 + r)$, representing the trade-off between consumption in the first and second periods, where $r$ is the real interest rate.

If We Represents a Two-Period Consumer's Lifetime Wealth And rrr Denotes the Real Rate of Interest, the Slope of the Denotes

If We Represents a Two-Period Consumer's Lifetime Wealth And $r$ Denotes the Real Rate of Interest, the Slope of the Denotes