Kutay
University
30. In a two good intertemporal consumption problem, a consumer has a utility
function U = C1^2 C2 . If the interest rate is 0 and the endowment is 15 in
both periods, then
(a). borrowing is 10.
(b). saving is 10.
(c). borrowing is 5.
(d). saving is 5.
(e). none of the above is correct.
The answer is c
How do you get this ?
function U = C1^2 C2 . If the interest rate is 0 and the endowment is 15 in
both periods, then
(a). borrowing is 10.
(b). saving is 10.
(c). borrowing is 5.
(d). saving is 5.
(e). none of the above is correct.
The answer is c
How do you get this ?