Author Question: In the two-period model, the budget constraint is kinked for all of these reasons, except A) the ... (Read 49 times)

beccaep · **on:** Jun 30, 2018

In the two-period model, the budget constraint is kinked for all of these reasons, except

A) the real interest rate is greater than zero.
B) there are costs to banks from lending and borrowing.
C) there is asymmetric information in the credit market.
D) there is limited commitment in the credit market.

Question 2

Two key properties of indifference curves are that an indifference curve slopes

A) upward and is bowed out from the origin.
B) downward and is bowed out from the origin.
C) upward and is bowed in toward the origin.
D) downward and is bowed in toward the origin.