Accounting Equation Inspirational Inc. is a motivational consulting business. At the end of its accounting period, October 31, 20Y2, Inspirational has assets of $589,060 and liabilities of $186,140. Using the accounting equation and considering each case independently, determine the following amounts: a. Stockholders' equity as of October 31, 20Y2. $fill in the blank 1 b. Stockholders' equity as of October 31, 20Y3, assuming that assets increased by $93,070 and liabilities increased by $55,960 during 20Y3. $fill in the blank 2 c. Stockholders' equity as of October 31, 20Y3, assuming that assets decreased by $46,540 and liabilities increased by $16,490 during 20Y3. $fill in the blank 3 d. Stockholders' equity as of October 31, 20Y3, assuming that assets increased by $77,760 and liabilities decreased by $29,450 during 20Y3. $fill in the blank 4 e. Net income (or net loss) during 20Y3, assuming that as of October 31, 20Y3, assets were $742,220, liabilities were $120,760, and no additional common stock was issued or dividends paid. $fill in the blank 6\

3. saving two consumers, larry and jeff, have utility functions defined over the two periods of their lives: middle age (period zero) and retirement (period 1). they have the same income in period 0 of m dollars and they will not earn income in period 1. the interest rate they face is r. larry’s and jeff’s utility functions are as follow. = 0.5 + 0.5 and = 0.5 + 0.5 for each person is between zero and one and represents each consumer’s temporal discount econ 340: intermediate microeconomics. ben van kammen: purdue university. rate. a. write the budget constraint that applies to both jeff and larry in terms of consumption in each period and ), interest rate, and m. b. what is larry’s and what is jeff’s marginal rate of intertemporal substitution? c. what is the slope of the budget constraint? d. write each consumer’s condition for lifetime utility maximization. e. re-arrange the conditions from part (d) to solve for the ratio, . f. if > which consumer will save more of his middle age income? g. if > 1 1+ , in which period will larry consume more: = 0 or = 1?