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7 Consider the stationary equilibrium of the overlapping generations model with at money when the population is constant. a] lStarefully setting up the budget constraints,
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Consider the stationary equilibrium of the overlapping generations model with at money when the population is constant. a] lStarefully setting up the budget constraints, characterize the equilibrium of the money market and derive an expression for the rate of return of at money in equilibrium. b] Use this model to illustrate the quantity theory of money. c) Suppose there is an additional asset in the economy, priyate leans. Discuss whether in equilibrium at money and private leans can coexistStep by Step Solution
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