1. The consumer' s utility function is U (CO, C1) Co*C1/2 s.t. 10-60 and 11=100, where...

 

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1. The consumer' s utility function is U (CO, C1) Co*C₁1/2 s.t. 10-60 and 11=100, where the Co is the amount of consumption at the period 0, the C1 is the amount of consumption at the period 1, The 10 is consumers income at the period 0 and /1 is consumer's income at the period 1. Suppose the deposit interest rate is r, which is equal to the lending rate, then (1) If r=0, will this consumer be a saver or a borrower? (2) If r=1, will this consumer be a saver or a borrower? 2. If the firm's production function is Q= ALa (0<a<1), and the capital is constant J, the please proof: (1) The supply Q increases as the market price p rises; (2) The supply Q decreases as the labor wage rate w rises. 3. If the firm's production function is Q= 100L¹/2, (1) Please draw the production curve (3) Please calculate the APL (average production) (4) Please proof the APL decreases as the labor supple L rises; (5) Please proof the MPL=50/(L1/2) and MPL< APL regardless of the labor supple L. 1. The consumer' s utility function is U (CO, C1) Co*C₁1/2 s.t. 10-60 and 11=100, where the Co is the amount of consumption at the period 0, the C1 is the amount of consumption at the period 1, The 10 is consumers income at the period 0 and /1 is consumer's income at the period 1. Suppose the deposit interest rate is r, which is equal to the lending rate, then (1) If r=0, will this consumer be a saver or a borrower? (2) If r=1, will this consumer be a saver or a borrower? 2. If the firm's production function is Q= ALa (0<a<1), and the capital is constant J, the please proof: (1) The supply Q increases as the market price p rises; (2) The supply Q decreases as the labor wage rate w rises. 3. If the firm's production function is Q= 100L¹/2, (1) Please draw the production curve (3) Please calculate the APL (average production) (4) Please proof the APL decreases as the labor supple L rises; (5) Please proof the MPL=50/(L1/2) and MPL< APL regardless of the labor supple L.

Answer rating: 100% (QA)

Solution 1 1 If r 0 the consumer will be a borrower When r 0 the consumer can borrow money at period ... View the full answer