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johnpaul92 johnpaul92
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8 years ago
How would each of the following affect Cheryl Shirker's current consumption and saving? Cheryl is a forward-looking consumer with no borrowing constraints.
(a)   Cheryl's firm announces a reorganization plan, increasing Cheryl's future income dramatically.
(b)   Cheryl's father, who had planned to leave her a large bequest, must spend all his wealth on medical bills after a prolonged illness.
(c)   The real interest rate rises from its original level. Cheryl originally planned to have no assets for the future; that is, she planned to spend all her original assets and all her income when she was young, and planned to consume an amount equal to her future income when she was old.
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Macroeconomics

Macroeconomics


Edition: 8th
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supamansupaman
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johnpaul92 Author
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#2
8 years ago
This answers my question, thank you so much
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