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. Given the parameters you drew earlier, solve your problem now at 21 interest rate points, evenly spaced between T = 1.0 and r =

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. Given the parameters you drew earlier, solve your problem now at 21 interest rate points, evenly spaced between T = 1.0 and r = 1.20. Write down your rm's optimal choice at each rate point. Draw a demand curve for the rm. Write a few sentences interpreting this curve. You can solve for this computationally. You can also derive this curve using the analytical equations from earlier. Solve your analytical problem with the 5\" inside the equation, what is the optimal borrowing choice as a function of r? . Given the parameters you drew earlier, at what 1' level would the demand for capital would be K = 25. And at what 7' level would the demand for capital would be K = 0.05. . Suppose there are four types of rms in the economy, use the commands below to draw fractions of these four types of rms and write them down. % Type 1 fraction 1 2 frac_t1 = rand() 3 frac_t2 = (1 frac_t1)*rand() 4 frac_t3 = (1 frac_t1 frac_t2)*rand() 5 frac_t4 = 1 frac_t1 frac_t2 frac_t3 . Type 1 has high A and high a: A = 1.2 and a = 0.30, type 2 has high A and low a: A = 1.2 and o: = 0.20, type 3 low A and high a: A = 0.8 and low a = 0.30, and type 4 low A and low a: A = 1.2 and a = 0.20. What are the demand curves for each of the four types of rms? What are the different effects of the two parameters? . Given the fractions of rms you have from each of these groups, solve for the aggregate demand curve for credit in your economy. . Plot your aggregate supply curve for credit from last homework, over-lay it on top of the aggregate demand curve here

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