Question: Chapter 2 [Appendix]: Suppose utility equals infc) +b mag-4.13). Using the steps explained in the appendix {with stationary equilibrium}: a. Find an expression for real
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Chapter 2 [Appendix]: Suppose utility equals infc\") +b mag-4.13\"). Using the steps explained in the appendix {with stationary equilibrium}: a. Find an expression for real demand for money in terms of b and yat the point where utility is maximized. Show steps. [5 marks} b. Deriye expressions for life time consumption pattern corresponding to utility maximization denoted by c'Ltand c191\"; where notations haye usual meanings. Show steps. [5 marks}. c. If suppose the exponents of cilyand 52,\": are interchanged in the aboye utility function, how will such change affect the real demand for money expression you derived in part a. No derivation is required, intuitiye explanation in 2-3 sentences will suffice as an answer. [2 marks]
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