questions

1. what is the expected value and the standard deviation of Q2?

2. Assume that =0. what is the equilibrium values of C1 and B*1?

3. Now assume that >0. what is the equilibrium value of B*1 ?What is the predicted effect of the precautionary savings on the current account? please explain as much as possible so I can understand

B0 and B1 is equal to 0

assume that households are risk neutral in period 2 rather than risk-averse. Assume the following preferences 111(01) -l E(02) where C1 and C2 are the consumption in periods 1 and 2, respectively. Note that the second period utility does not have any logarithmthe preferences are logarithmic in period 1 but linear in period 2 consumption. Assumed that the households can borrow or lend at the * foreign interest rate r . Furthermore, consider a situation in which Q1=Q, but Q2 is unknown in period 1. In particular, assume Q _ Q+o withp:0.5 2 620 with (1p):0.5 Finally, assume 33:0