The problem is shown in the figure

2. The notes make some simplifying assumptions in order to generate simple expressions. One of these assumptions is that r = p. Suppose we relaxed this assumption (i.e. allowed 1' to differ from ,0). Two results of the model from the notes are: i) The household keeps the expected value of consumption constant over time. ii) The household responds differently to permanent versus temporary income changes. Discuss the implications of allowing r to differ from p on each of these results. [3 points]