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Question 2 Assume a set of well-behaved (i.e. strictly monotone and strictly convex) intertemporal indifference curves between period 1 and 2. Then suppose that the

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Question 2 Assume a set of well-behaved (i.e. strictly monotone and strictly convex) intertemporal indifference curves between period 1 and 2. Then suppose that the nominal interest rate r decreases. Explain what happens to the new interior solution if current and future consumption are normal and inferior goods, respectively

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