Question: In the stationary equilibrium, household solves the problem given (w, r). (i) Write down the household problem recursively. (In the steady state, value function doesn't

In the stationary equilibrium, household solves the problem given (w, r). (i) Write down the household problem recursively. (In the steady state, value function doesn't have to depend on the distribution. Thus, you don't have to express law of motion for the distribution.) (ii) This life cycle model can generate hump-shaped earnings profile endogenously. Explain why it can be generated

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