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I have no idea in this question, try and give resonnably good explanations Anna lives for two periods, 1 and 2. Her consumption in the
I have no idea in this question, try and give resonnably good explanations
Anna lives for two periods, 1 and 2. Her consumption in the two periods is determined by the tangency point between the indifference curve (?) and the budget line
(d) How is Anna's consumption in period 2 affected by the decrease in the interest rate?
(e) Explain the results in terms of income and substitution effects.
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