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plz solve this
A person starts working when she is 25 years old and works until the age of 60. She earns an
average annual income of Rs 500,000 and expects to live till she reaches 85 years of age.
Applying Life Cycle Hypothesis, calculate her average consumption. Find her MPC out of
wealth and MPC out of income. Note that her consumption before 25 years of age is not
determined by her.
Suppose, she earns Rs 400.000 annually when she is 25-40 years, Rs 500,000 annually when
she is 40-50 years and Rs 600,000 annually when she is 50-60 years, find her annual
consumption. If she wins a lottery of Rs 500,000 when she is 42 years, what would be her
increase in annual consumption? Instead, if she gets a promotion when she is 40 years old
and there is a jump in her earnings by Rs 300,000 annually, find her new annual consumption
level.
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