Question: Mike has a Cobb-Douglas utility function u(c1,c2)=c1c2 where 0 < <1, 0 < <1, +=1, and c1 and c2 are his consumption in period 1

Mike has a Cobb-Douglas utility function u(c1,c2)=c1c2 where 0<<1, 0<<1, +=1, and c1 and c2 are his consumption in period 1 and period 2, respectively. Mike can borrow or save at interest rate r. Suppose that Mike receives incomes of $0 in the first period and $120.00 in the second period. Let equal 0.15, and let the interest rate equal 2.00%. Give all answers to two decimals. Mike's first-period consumption is c1 = . Mike's second-period consumption is c2 =? Suppose the interest rate had been 4.00% instead. Before you recalculate first- and second-period consumption, you know that Mike will be better off with the new interest rate. Give all answers to two decimals. Under this new interest rate, Mike's first-period consumption is c1 = . Under this new interest rate, Mike's second-period consumption is c2 =

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