This question relates to the overlapping generations model covered in the module. Compare two economies X and Y where in each economy, a constant N number of young people are born in each period and the supply of fiat money is constant at M. In addition, each individual has an endowment of y units of the consumption good when young and zero when old. Thus, the economies are identical in terms of their population, supply of fiat money, and endowments. However, the preferences of individuals are different in the two economies. In particular, the preferences are such that individuals in economy X would like to consume more in the first period of their lives compared to those in economy Y. We assume stationarity. Consider the monetary equilibrium in the two economies. (a) Write down the equations that describe the constraints on first and second period consumption for a typical person in any one economy. Combine these equations into a lifetime budget constraint for this person. [5 marks] (b) What will be the rates of return of fiat money in the two economies? Will it be the same or different in the two economies? Explain your answer. [10 marks] (c) What will be the value of money in the two economies? Will the value of money be the same or different in the two economies? If they are different, which economy has the lower value of money? Explain your answer. [15 marks]