Inferring Preferences from Intertemporal Choice
Two individuals have the same initial resources and face the same market interest rate for borrowing or lending, meaning they share an identical feasible frontier for their consumption choices between 'now' and 'later'. Despite these identical opportunities, one individual chooses to borrow, while the other chooses to save. What fundamental difference in their personal valuations of present versus future consumption can be inferred from these choices? Explain your reasoning by referencing the properties of indifference curves that would lead to these different outcomes.
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CORE Econ
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Introduction to Microeconomics Course
The Economy 2.0 Microeconomics @ CORE Econ
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