In this problem annual income for ages 20 to 80 is given graphically. People sometimes spend less than their income (to save for retirement) or more than their income (taking out a loan). The process of spreading out spending over a lifetime is called consumption smoothing. annual income ($1000s per year) 76 38 Age (years) 20 40 60 80 (a) Find the average annual income for these years. The average annual income is i eTextbook and Media dollars/year. (b) Assuming that people spend at a constant rate equal to their average income, when are they spending less than they earn, and when are they spending more? Enter your answers in increasing order. They spend less than their income every year from age i to i They spend more than their income every year from age i to age to and from

ENGR.ECONOMIC ANALYSIS
14th Edition
ISBN:9780190931919
Author:NEWNAN
Publisher:NEWNAN
Chapter1: Making Economics Decisions
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In this problem annual income for ages 20 to 80 is given graphically. People sometimes spend less than their income (to save for retirement) or more than their income (taking out a loan). The process of spreading out spending over a lifetime is called consumption smoothing. annual income ($10nns nar vaar) years) (a) Find the average annual income for these years. The average annual income is dollars/year. eTextbook and Media (b) Assuming that people spend at a constant rate equal to their average income, when are they spending less than they earn, and when are they spending more? Enter your answers in increasing order. They spend less than their income every year from age to They spend more than their income every year from age to and from age to
 
In this problem annual income for ages 20 to 80 is given graphically. People sometimes spend less than their income (to save for
retirement) or more than their income (taking out a loan). The process of spreading out spending over a lifetime is called consumption
smoothing.
annual income
($1000s per year)
76
38
20
40
40
60
60
Age (years)
80
(a) Find the average annual income for these years.
The average annual income is i
eTextbook and Media
dollars/year.
(b) Assuming that people spend at a constant rate equal to their average income, when are they spending less than they earn, and
when are they spending more?
Enter your answers in increasing order.
They spend less than their income every year from age i
to
i
They spend more than their income every year from age i
to
age
i
to
i
and from
Transcribed Image Text:In this problem annual income for ages 20 to 80 is given graphically. People sometimes spend less than their income (to save for retirement) or more than their income (taking out a loan). The process of spreading out spending over a lifetime is called consumption smoothing. annual income ($1000s per year) 76 38 20 40 40 60 60 Age (years) 80 (a) Find the average annual income for these years. The average annual income is i eTextbook and Media dollars/year. (b) Assuming that people spend at a constant rate equal to their average income, when are they spending less than they earn, and when are they spending more? Enter your answers in increasing order. They spend less than their income every year from age i to i They spend more than their income every year from age i to age i to i and from
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