I. Consumption and Saving (cont.)
{"Image DocumentName": "I. Consumption and Saving (cont.)", "Image ImageDescription": "B) The consumption and saving decision of an individual. 1. A person can consume less than current income (saving is positive) 2. A person can consume more than current income (saving is negative) 3. Trade-off between current consumption and future consumption. a. The price of 1 unit of current consumption is 1 + r units of future consumption, where r is the real interest rate. b. Consumption-smoothing motive: the desire to have a relatively even pattern of consumption over time.", "Image XResolution": "37", "Image YResolution": "37", "Image ResolutionUnit": "Pixels/Centimeter", "Image Software": "SlidePlayer", "Image YCbCrPositioning": "Centered"}