Consider an OLG economy where each generation has 14 bananas when young, and 6 bananas when old.

1. What is the consumption levels cy and co of gen 1 without money? What is their lifetime happiness?

2. Suppose central bank prints out 4 units of money, given to gen 0 for free.

Solve for the equilibrium exchange rate "1 money = v bananas".

3. In part 2, what is the consumption levels cy and co of gen 1? What is their lifetime happiness?

4. Instead of printing moneies to give to gen 0, is there another government policy that could help achieve the same consumption outcome of part 3? (Hint: social securities)