An individual has two employment opportunities involving the same work conditions but different incomes. Job 1 yields 50 in year 1, and 30 in year 2. Job 2 yields 40 in year 1 and 40 in year 2. The markets are perfect and bonds yield 5%. la. If you consume everything in year 1, how much more could you consume from Job 1 than Job 2? 1b. If you consume everything in year 2, how much more could you consume from Job 2 than Job 1?
An individual has two employment opportunities involving the same work conditions but different incomes. Job 1 yields 50 in year 1, and 30 in year 2. Job 2 yields 40 in year 1 and 40 in year 2. The markets are perfect and bonds yield 5%. la. If you consume everything in year 1, how much more could you consume from Job 1 than Job 2? 1b. If you consume everything in year 2, how much more could you consume from Job 2 than Job 1?
Essentials Of Investments
11th Edition
ISBN:9781260013924
Author:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.
Publisher:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.
Chapter1: Investments: Background And Issues
Section: Chapter Questions
Problem 1PS
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