Suppose that an individual gains utility from Consumption today (c) and Consumption tomorrow (C). There are only two periods - today and tomorrow. The individual gains utility from consumption in each of these periods according to their utility function: U(C, C) = C /2c/2 Assume also that this individual has income in both periods. an income today (m) = $100 and an income tomorrow (m) = $200. An individual can always borrow $1 today, at the cost of $1(1+r) tomorrow, or can always save $1 today and receive $1(1+r) tomorrow. The interest rate (r) is equal to 20%. 15. Write down this individual's budget constraint. [1 point] 16. What is this individual's current utility-maximizing choice of c; and c? Show your work. [2 points] Suppose now that the interest rate increases to 40%. 17. What is this individual's new utility-maximizing choice of c, and c? How much of this change in c and c can be attributed to the substitution effect and how much to the income effect? Use the Hicksian Decomposition for these calculations. Show your work. [3 points]