Check if the following statement is true or false: "In the two-period endowment economy model reviewed in Chapter 3 of the textbook, if the household's initial net asset position is negative,

B0<0, then the initial endowment (Q_1,Q₂) is located above the intertemporal budget constraint (IBC) and for that reason, it is not feasible (not affordable) for the household to consume its endowment in each period (in other words, it is not affordable for the household to choose C₁= Q₁and C₂= Q₂)."

Use equations and the graph of the intertemporal budget constraint to support your answer (with C₂on the vertical axis and C₁on the horizontal axis).

http://www.columbia.edu/~mu2166/UIM/suw.pdf

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