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Both answers for Qs are correct. I need help finding the answers for r, C1, and C2, please. I already know that NONE of the
Both answers for Qs are correct. I need help finding the answers for r, C1, and C2, please. I already know that NONE of the answers are 0, r is NOT 100, C1 is NOT 10, and C2 is NOT 20. Thank you!
Problem Set due Dec 7, 2021 18:30 EST Problem PS9.2.1 V1 point (graded Suppose that there are only 10 individuals in the economy each with the following utility function over present and future consumption: U (1,0) = 0+where is consumption today, and is consumption tomorrow. Consumption tomorrow is less valued because people are impatient and prefer consuming now rather than later. Buying 1 unit of consumption today costs $1 today and buying 1 unit of consumption tomorrow costs $1 tomorrow. All individuals have income of 10 dollars today and no income tomorrow (because they will be retired) but they can save at the market interest rate 20. Suppose that in this economy all the funds for capital come from savings by the 10 individuals. Firms demand for capital is given by Qp = 100 - 100r. What is the market supply for funds if the interest rate is 30%? Qs 0 0 What is the market supply for funds if the interest rate is 70%? Qs 100 100 What is the equilibrium interest rate that clears the capital market? What is aggregate consumption in each period at that interest rate? G- Problem Set due Dec 7, 2021 18:30 EST Problem PS9.2.1 V1 point (graded Suppose that there are only 10 individuals in the economy each with the following utility function over present and future consumption: U (1,0) = 0+where is consumption today, and is consumption tomorrow. Consumption tomorrow is less valued because people are impatient and prefer consuming now rather than later. Buying 1 unit of consumption today costs $1 today and buying 1 unit of consumption tomorrow costs $1 tomorrow. All individuals have income of 10 dollars today and no income tomorrow (because they will be retired) but they can save at the market interest rate 20. Suppose that in this economy all the funds for capital come from savings by the 10 individuals. Firms demand for capital is given by Qp = 100 - 100r. What is the market supply for funds if the interest rate is 30%? Qs 0 0 What is the market supply for funds if the interest rate is 70%? Qs 100 100 What is the equilibrium interest rate that clears the capital market? What is aggregate consumption in each period at that interest rate? GStep by Step Solution
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