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ME HW 4.2 2. To have a more realistic consumption equation, assume that consumption function defined as the following: Ct = ac Yt - bc

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ME HW 4.2

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2. To have a more realistic consumption equation, assume that consumption function defined as the following: Ct = ac Yt - bc (Rt - F) Yt Assume the rest of the model is unchanged from the original setup. Derive the IS curve for this new specification

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