Hector's wealth is zero, he expects to work for another 45 years at a constant salary of $80,000 and live for another 60 years. If yearly taxes are $20,000 and Hector completely smooths consumption over his lifetime, his annual consumption is

A) $37,500.
B) $45,000.
C) $60,000.
D) $70,000.


B

Economics

You might also like to view...

When voluntary exchange takes place, neither party usually gains from the exchange

Indicate whether the statement is true or false

Economics

Explain how economic profits are reduced to zero as new firms enter a monopolistically competitive industry

Economics

The concept of equity pertains to the fairness of a tax.

Answer the following statement true (T) or false (F)

Economics

Other things being equal, what impact does enhanced consumer information on the risk of colon cancer linked to red-meat consumption have on the equilibrium in the market for beef?

A. A decrease in both price and quantity; B. An increase in price and decrease in quantity; C. A decrease in price and an increase in quantity. D. Not enough information is provided to answer this question;

Economics