Suppose you receive Y1 of your income this period and Y2 of your income next period. If you can either borrow or lend at an interest rate r, what is the most you can consume in the current period?
A)Y1(1 + r) + Y2
B)Y2(1 + r) + Y1
C)Y1/(1 + r) + Y2
D)Y2/(1 + r) + Y1

Question

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The Answer of Suppose you receive Y1 of your income this period and Y2 of your income next period. If you can either borrow or lend at an interest rate r, what is the most you can consume in the current period?
A)Y1(1 + r) + Y2
B)Y2(1 + r) + Y1
C)Y1/(1 + r) + Y2
D)Y2/(1 + r) + Y1

Suppose You Receive Y1 of Your Income This Period and Y2