Question: If a consumer with a Cobb - Douglas utility function has a marginal rate of substitution at its endowment point ( w 1 , w

If a consumer with a Cobb-Douglas utility function has a marginal rate
of substitution at its endowment point (w1,w2) that exceeds in absolute value the quantity (1+ r), where r is the real interest rate, then in the two-period
model this consumer will have positive savings between period 1 and period 2.

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