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Assume Cornucopia is an economy with constant population. Each person is endowed with a considerable amount of goods y1 when young, and very little amount
Assume Cornucopia is an economy with constant population. Each person is endowed with a considerable amount of goods y1 when young, and very little amount of goods y2 when old. As a consequence, people would like to consume more than they have in the second period of life. a) Assuming a stationary allocation, find the feasible set. b) Graph the set of stationary per-capita feasible allocations
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