Question
1. The consumer' s utility function is U (CO, C1) Co*C1/2 s.t. 10-60 and 11=100, where the Co is the amount of consumption at
1. The consumer' s utility function is U (CO, C1) Co*C1/2 s.t. 10-60 and 11=100, where the Co is the amount of consumption at the period 0, the C1 is the amount of consumption at the period 1, The 10 is consumers income at the period 0 and /1 is consumer's income at the period 1. Suppose the deposit interest rate is r, which is equal to the lending rate, then (1) If r=0, will this consumer be a saver or a borrower? (2) If r=1, will this consumer be a saver or a borrower? 2. If the firm's production function is Q= ALa (0
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Intermediate Microeconomics
Authors: Hal R. Varian
9th edition
978-0393123975, 393123979, 393123960, 978-0393919677, 393919676, 978-0393123968
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