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The Intertemporal Budget Constraint Is Written As:
A) B) C) ctoday +cfuture =ftoday (1+R)+ytoday +yfuture c _ { \text {today } } + c _ { \text {future } } = f _ { \text {today } } ( 1 + R ) + y _ { \text {today } } + y _ { \text {future } }

Question 2

Multiple Choice

The intertemporal budget constraint is written as:


A) ctoday +(cfuture /1+R) =ftoday +ytoday +(yfature /1+R) c _ { \text {today } } + \left( c _ { \text {future } } / 1 + R \right) = f _ { \text {today } } + y _ { \text {today } } + \left( y _ { \text {fature } } / 1 + R \right)

B) [(ctoday /(1+R) ]+cfuture =ftoday +[ytoday /(1+R) ]+yfuture \left[ \left( c _ { \text {today } } / ( 1 + R ) \right] + c _ { \text {future } } = f _ { \text {today } } + \left[ y _ { \text {today } } / ( 1 + R ) \right] + y _ { \text {future } } \right.
C) ctoday +cfuture =ftoday (1+R) +ytoday +yfuture c _ { \text {today } } + c _ { \text {future } } = f _ { \text {today } } ( 1 + R ) + y _ { \text {today } } + y _ { \text {future } }
D) u(ctodey ) +βu(cfuture ) =ftodey +γtodey γfuture u \left( c _ { \text {todey } } \right) + \beta u \left( c _ { \text {future } } \right) = f _ { \text {todey } } + \gamma _ { \text {todey } } - \gamma _ { \text {future } }
E) ctodey +ytoday =(cfuture /1+R) +(γfuture /1+R) c _ { \text {todey } } + y _ { \text {today } } = \left( c _ { \text {future } } / 1 + R \right) + \left( \gamma _ { \text {future } } / 1 + R \right)

Correct Answer:

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