Consumer has utility function In(c1)+beta'In(c2), where beta=1. Interest rate i=0%. (NOTE!) Income y1=10 and y2-50. Gov't gives consumer a free stimulus check of $20 in the first period. Assume consumers are NAIVE, then in the first period the consumer will consume c1=

Consumer has utility function In(c1)+beta'In(c2), where beta=1. Interest rate i=0%. (NOTE!) Income y1=10 and y2-50. Gov't gives consumer a free stimulus check of $20 in the first period. Assume consumers are NAIVE, then in the first period the consumer will consume c1=

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Chapter1: Making Economics Decisions

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Consumer has utility function In(c1)+beta*In(c2), where beta=1.
Interest rate i=0%. (NOTE!)
Income y1=10 and y2=50.
Gov't gives consumer a free stimulus check of $20 in the first period.
Assume consumers are NAIVE, then in the first period the consumer will consume c1=

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