Question: Inter-temporal Investment/Consumption Summarize Fishers separation theorem. Why is this theorem important to both investors and corporations? Why is the existence of a capital market important

  1. Inter-temporal Investment/Consumption
    1. Summarize Fishers separation theorem.
    2. Why is this theorem important to both investors and corporations?
    3. Why is the existence of a capital market important to the theorem? Illustrate this graphically in the two-period framework and show/explain how consumers will maximize utility.
    4. What are some of the assumptions that cause the theorem to hold?

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