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ll. lntertemporal Trade (Part II). Consider a small country that wants to consumption smooth as much as possible. If no investment is made, output at
ll. lntertemporal Trade (Part II). Consider a small country that wants to consumption smooth as much as possible. If no investment is made, output at t = 0 will be 100 and output at t=1 will be 100. If the country invests 1 unit today, it can produce 110 units tomorrow. Finally, assume that the intertemporal utility function at Home is U(C0;C1)=min{C0;C1} b. (1 point) Suppose that the country can borrow and lend at r = 2%. Will the country undertake the investment
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