1. Lectures in Macroeconomics- Charles W. Upton Consumption A Life Cycle Extension

2. Consumption-A Life Cycle Extension 2 The Basic Fisherian Model cLcL cNcN z

3. Consumption-A Life Cycle Extension 3 The Basic Fisherian Model cLcL cNcN z People live for four periods. Same idea, but graphs are not as useful.

4. Consumption-A Life Cycle Extension 4 The Basic Fisherian Model Our consumption function

5. Consumption-A Life Cycle Extension 5 The Basic Fisherian Model

6. Consumption-A Life Cycle Extension 6 The Basic Fisherian Model

7. Consumption-A Life Cycle Extension 7 The Basic Fisherian Model

8. Consumption-A Life Cycle Extension 8 The Basic Fisherian Model log(c 1 ) + log(c 2 ) + log(c 3 ) + log(c 4 )

9. Consumption-A Life Cycle Extension 9 The Basic Fisherian Model log(c 1 ) + log(c 2 ) + log(c 3 ) + log(c 4 )

10. Consumption-A Life Cycle Extension 10 The Basic Fisherian Model log(c 1 ) + log(c 2 ) + log(c 3 ) + log(c 4 ) γ 1 log(c 1 ) + γ 2 log(c 2 ) + γ 3 log(c 3 ) + γ 4 log(c 4 )

11. Consumption-A Life Cycle Extension 11 Some Assumptions PeriodWage Rate 10 2300,000 3630,000 40 r= 50%

12. Consumption-A Life Cycle Extension 12 Period One Calculations

13. Consumption-A Life Cycle Extension 13 Period One Calculations

14. Consumption-A Life Cycle Extension 14 Period One Calculations

15. Consumption-A Life Cycle Extension 15 Period One Calculations

16. Consumption-A Life Cycle Extension 16 Period One Calculations

17. Consumption-A Life Cycle Extension 17 Period Two Calculations

18. Consumption-A Life Cycle Extension 18 Period Two Calculations

19. Consumption-A Life Cycle Extension 19 Period Two Calculations

20. Consumption-A Life Cycle Extension 20 Period Two Calculations

21. Consumption-A Life Cycle Extension 21 Period Two Calculations

22. Consumption-A Life Cycle Extension 22 Period Two Calculations

23. Consumption-A Life Cycle Extension 23 Period Three Calculations

24. Consumption-A Life Cycle Extension 24 Period Three Calculations

25. Consumption-A Life Cycle Extension 25 Period Three Calculations

26. Consumption-A Life Cycle Extension 26 Period Three Calculations

27. Consumption-A Life Cycle Extension 27 Period Four Calculations

28. Consumption-A Life Cycle Extension 28 Period Four Calculations

29. Consumption-A Life Cycle Extension 29 Period Four Calculations

30. Consumption-A Life Cycle Extension 30 And in Conclusion… This lecture focuses on mechanics. Later lectures focus on ideas.

31. Consumption-A Life Cycle Extension 31 End ©2005 Charles W. Upton. All rights reserved