'alculate the equilibrium levels of the trade balance and current account in period 1. - '3} Explain how a lower discounting factor (0 H l ) nations the optimai allocation of consumption {C}: C2) and the trade balance and 1hr;- current account in period 'I. l_we assumed = 1. -1 Explain what would happen to the optimal allocation of consumption ii If W. D- Suppose the household chooses C1 and C2 to solve the following maximization program given Bo. ro. 1, Q1 and Q2 argmaxci,C2 In(C1) + Bin(C2)] subject to the intertemporal budget constraint (IBC) C1+ C2 = (1 + ro) Bo + Q 1+ 7 Q 2 - = Y 1 tri 1 + r 1 where BY is the lifetime Income (Wealth). The its) Calculate the optimal allocation of C1 and C2