1. Suppose that a household has preferences given by: log(C'm) + log(C's) + 3 [log(C'm!) + log(C')] where C'm is consumption of cash goods, C is consumption of credit goods. The household doesn't value leisure and supplies one unit of labor inelastically. The household starts with M- nominal money holdings and no nominal bond holdings (B- = 0), and faces the CIA constraints: PCm