Explain how unsustainable borrowing and lending patterns can lead to asset bubbles and financial instability.

Aug 31, 2020 ... In its standard form, the intertemporal budget constraint requires the present value of a government's future primary cash surpluses to be ... Oct 3, 2021 ... Imagine that income in the current period falls (moves to E'). All else being equal, use the line tool to draw the new intertemporal budget constraint. Aug 29, 2022 ... site logo Join Economics · OR · Illustration of upvote icon after it is clicked · Hang on, you can't upvote just yet. · Illustration of upvote ... The intertemporal budget constraint is based on the assumption that income and interest rates are ... A. determined by the consumer. B. determined by the gov't 2. Consumer's choices are subject to an intertemporal budget constraint-a measure of the total resources available for present and future consumption. Given the ... intertemporal budget constraint proceeds as in the proof of Proposition 1. Moreover, we can again show that the hypothesized plan for each unit satisfies ... The theoretical model of the intertemporal budget constraint suggests that when the rate of return rises, the quantity of saving may rise, fall, or remain the ... The government's intertemporal budget constraint requires that the present value of current and future taxes must be sufficient to cover the present value of ... combined with the intertemporal budget constraint, determine the optimal allocation of (c1,t,h1,t,c2,t+1,h2,t+1). 1.1.2 Tax on Capital Mimics Age-Dependent ... This is called the intertemporal budget constraint. The present value sum of ... How to derive the intertemporal budget constraint. 3. Conditions for ...