Re: Intertemporal Maximization

Posted by economist on Feb 12, 2014; 1:37pm
URL: http://discussion-forum.276.s1.nabble.com/Intertemporal-Maximization-tp7584733p7584734.html

Its a question of consumption smoothing. As utility is concave person will choose same consumption every year. Simply use the budget constraint  to find that constant c. ASSUMING OFCOURSE PERSON IS ALLOWED TO BORROW AND LEND FREELY.
 Its a solved example in hammond , you can refer.