1 Euler equation A representative household maximizes where E ) 3 [log(Ct+j – 0Ct+j−1) – Xht+j], j=0 Ct+j + Kt+j = Wt+jh

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1 Euler Equation A Representative Household Maximizes Where E 3 Log Ct J 0ct J 1 Xht J J 0 Ct J Kt J Wt Jh 1 (25.01 KiB) Viewed 25 times

1 Euler equation A representative household maximizes where E ) 3 [log(Ct+j – 0Ct+j−1) – Xht+j], j=0 Ct+j + Kt+j = Wt+jht+j +Pt+jKt+j−1 +It+j − T. (1) (2)

5. Derive (a) the labor supply condition; and (b) the Euler equation with respect to consumption.