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Business, 16.11.2019 03:31 nculberson6

Consider an individual who lives for m periods, the first h of which he spends working. income in those first h periods is given by yt, and income in periods h+1 through m is zero. the individual has a discount factor of Ī² and can save and borrow at the real interest rater. the individualā€™s optimal behavior is dictatedby the standard euler equation (you donā€™t need to derive it).

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