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Suppose that the real interest rate is r = 0.2. At his endowment point (yt, y t), the value of the consumer's marginal rate of
Suppose that the real interest rate is r = 0.2. At his endowment point (yt, y t), the value of the consumer's marginal rate of substitution is M RSc,c = 1.2. What does this imply about the consumer's savings in the current period? Circle one of the following options. s < 0, s > 0, s = 0
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