A utility saver with utility function u = f₁1/2f21/2 earns m₁ = 40 and m₂ = 0. She can save at an interest rate of 25 percent. How much will she save?

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Chapter29: Interest, Rent, And Profit
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A utility saver with utility function u = f₁1/2f21/2 earns m₁ = 40 and m₂ = 0. She can save at
an interest rate of 25 percent. How much will she save?
Transcribed Image Text:A utility saver with utility function u = f₁1/2f21/2 earns m₁ = 40 and m₂ = 0. She can save at an interest rate of 25 percent. How much will she save?
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