McDonald's Monopoly game is a popular contest the restaurant chain has offered for several years. The chances of winning a food prize are approximately 1 in 4. Here were the chances in 2011 for collecting the less common game pieces, each of which netted a nonfood prize. All values listed are approximate according to McDonald's. Mediterranean Avenue ($50 prize. 10,000 prizes)-1 in 61,811 Vermont Avenue ($100 prize, 3,000 prizes)-1 in approx. 206,036 Virginia Avenue ($200 Spa Wish Gift Certificate, 250 prizes)-1 in 2,472,425 Tennessee Avenue (Beaches Resort Vacation, 300 prizes)-1 in 2,060,354 Kentucky Avenue (S50,000,8 prizes)-1 in 77.263,275 Short Line Railroad (EA Sports Fan Trip. 8 prizes) --1 in 77.263,275 Ventnor Avenue ($100,000, 6 prizes)-1 in 103,017,700 Pennsylvania Avenue (SL. MY 12 Nissan Leaf, 2 prizes)-1 in 309,053,100 Boardwalk ($1,000,000, 1 prize)-1 in 618,106,200 Source: playatmcd a. What percent of the time would a player expect to win a food prize

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?