Question: 2. Consider a consumer with preferences over current and future consumption given by 1/2 U(C1, C2) (1) (2) 1/2 = where c denotes the

2. Consider a consumer with preferences over current and future consumption given

2. Consider a consumer with preferences over current and future consumption given by 1/2 U(C1, C2) (1) (2) 1/2 = where c denotes the amount consumed in period 1 and c the amount consumed in period 2. Suppose that period 1 income expressed in units of good 1 is m = 20000 and period 2 income expressed in units of good 2 is m2 30000. Suppose also that P1 = P2 = 1 and let r denote the interest rate. (a) Find the optimal consumption bundle when r = a borrower? = 0.15. Is the consumer a saver or

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