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In the two-period intertemporal consumption model, if MRS = C2/(4C1), r= 5%, Y1 = 50 and Y2 = 105, the optimal consumption combination

a) is C1 = 50 and C2 = 105

b) is C1 = 30 and C2 = 30

c) is C1 = 30 and C2 = 126

d) Depends on whether the consumer has a borrowing constraint

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Business Economics, Economics

Category:- Business Economics
Reference No.:- M91696160

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