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2 questions
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Do standard consumer theory axioms rule out corner solutions?
By standard consumer theory axioms I mean (1) completeness, (2) transitivity, (3) continuity, (4) non-satiation, and (5) strict convexity of the indifference curves.
If these axioms are not sufficient ...
1
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0
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Numerical Solution Using Excel about optimal consumption of households
I'm not sure how to solve this problem. I'm given the discount factor, interest rate, probability of high income shock, and various income shock sizes that I need to use to compute optimal consumption....
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