If the budget line rotates from blue to red. Consumption Next Year B Consumption Today The interest rate has increased. The interest rate has decreased. The interest rate has not changed. If the person borrowed a $1 today they would owe more in the future. O If the person borrowed a $1 today they would owe less in the future. If the person saved a $1 today they would have more money in the future on the red budget line compared to the blue budget line. If the person saved a $1 today they would have less money in the future on the red budget line compared to the blue budget line.

If the budget line rotates from blue to red. Consumption Next Year B Consumption Today The interest rate has increased. The interest rate has decreased. The interest rate has not changed. If the person borrowed a $1 today they would owe more in the future. O If the person borrowed a $1 today they would owe less in the future. If the person saved a $1 today they would have more money in the future on the red budget line compared to the blue budget line. If the person saved a $1 today they would have less money in the future on the red budget line compared to the blue budget line.

Microeconomic Theory

12th Edition

ISBN:9781337517942

Author:NICHOLSON

Publisher:NICHOLSON

Chapter17: Capital And Time

Section: Chapter Questions

Problem 17.8P

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Saved to this PC V ut References A A Aa x² A a. b. C. O Search (Alt+Q) Mailings Review View Help Du A A EEE ΕΞ ΑΙ ¶ ↓ E- Paragraph LO Value of first donut Value of second donut Value of third donut Value of fourth donut Value of fifth donut Value of sixth donut S Normal Problem 1 Tammy loves donuts. The table shown reflects the value Tammy places on each donut she eats: $0.60 $0.50 $0.40 $0.30 $0.20 $0.10 If the price of donuts is $0.20, how-many donuts will Tammy buy? Why? Body Text How much consumer surplus would she have at a price of $0.20? Styles m If the price of donuts rose to $0.40, how many donuts would she purchase now? What would happen to Tammy's consumer surplus?