2. [Real Business Cycle]. Consider a simple RBC model as below: Household's Utility function is u(c,1)=bc!"" +1-b)"+ BE,{bc; +(1b)1.77} - where n=0.2 Budget restriction period-t is w,-1!2+1 +E, wl + E har 1+14+1 1+14+1 dan Cz+1! a. (5 points) Set up an appropriate Lagrangian form! b. (8 points) From point (a), construct the firs-order condition with respect to Ct C. (7 points) From point (b), show intertemporal consumption optimal condition (Euler equation)! d. (10 points) Explain clearly the effect of technological shock ( 4 ) on representative households' decision when: (i) covariant is zero, (ii) covariant is bigger than zero, and (iii) covariant is smaller than zero! provide brief economic interpretation. (Note: economic interpretation does not mean restating verbally the mathematics). 2. [Real Business Cycle]. Consider a simple RBC model as below: Household's Utility function is u(c,1)=bc!"" +1-b)"+ BE,{bc; +(1b)1.77} - where n=0.2 Budget restriction period-t is w,-1!2+1 +E, wl + E har 1+14+1 1+14+1 dan Cz+1! a. (5 points) Set up an appropriate Lagrangian form! b. (8 points) From point (a), construct the firs-order condition with respect to Ct C. (7 points) From point (b), show intertemporal consumption optimal condition (Euler equation)! d. (10 points) Explain clearly the effect of technological shock ( 4 ) on representative households' decision when: (i) covariant is zero, (ii) covariant is bigger than zero, and (iii) covariant is smaller than zero! provide brief economic interpretation. (Note: economic interpretation does not mean restating verbally the mathematics)