An investor with an initial endowment of $ 16,000 is confronted with the following productivity curve: C1= 240 (16,000 - C0)^0.5

where C0 denotes consumption at present, and C1 consumption in the future. Assume the interest rate (for borrowing and lending) is 20%. The investor's utility function, from which it is possible to derive his indifference curves, is defined as: U(C0,C1) =C0C1

How much will the investor invest in production?

$16,000

$0

$10,000

$12,000

An investor with an initial endowment of $16,000 is confronted with the following productivity curve: C1=240(16,000C0)0.5 where C0 denotes consumption at present, and C1 consumption in the future. Assume the interest rate (for borrowing and lending) is 20%. The investor's utility function, from which it is possible to derive his indifference curves, is defined as: U(C0,C1)=C0C1 How much will the investor invest in production? $16,000 $0 $10,000 $12,000