Julia had to borrow $2000 at a rate of 12% for one year to

buy a new car.  She heard that the

Reserve Bank may decrease the interest rate, so the rate on her loan would

decrease to 10%.

If her degree of impatience (ρ) is 0.12, can

Julia consume more or less when the interest rate decreases to 10%?  Answer 1 for yes and 2 for no.