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Questions › GATE › GATE 2026 › Q62
2 marksMacroeconomics › Consumption and investment › Intertemporal consumption and the Euler equationModerateabout 3 min

GATE 2026 Question 62: Consumption and investment

An individual lives for two periods, Period 1 and Period 2. In Period 1, her income is 210, and in Period 2, her income is 0. She saves in Period 1 and earns a real interest rate of 10% on these savings in Period 2. She does not save anything in Period 2. She consumes equal amounts in both the time periods. Her consumption in the current period is ______ (in integer)

Answer and worked solution

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Consumption and investment has come up 74 times in 7 exams since 2005.

What this question tests

This question is on Intertemporal consumption and the Euler equation, part of Consumption and investment in Macroeconomics.

Choosing consumption over two periods and the condition that links them.

TestStop has 5 past-paper questions on this subtopic.

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Question from the GATE 2026 paper. Solutions are TestStop's own. Not affiliated with or endorsed by any examination authority.