What is the optimal consumption level in each period

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In the two-period example in the text, suppose the marginal benefit curve for each period has a vertical intercept of 100 and a horizontal intercept of 50. What is the optimal consumption level in each period if the total quantity is 120? What is the dynamically efficient allocation in each period if the total quantity is 60 and the discount rate is zero? Illustrate (and inform) your answers with graphs.

Reference no: EM131312242

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