Match each statement with the portion of the aggregate demand–aggregate supply model that would be affected by it. drag each item on the left to its matching item on the right. a. negative unplanned investment b. positive unplanned investment c. planned investmentd. a game manufacturer produces 5,000 puzzles and sells 5,200 over the course of the year. e. an auto manufacturer produces 2,000 cars this month and sells 1,700 of them to consumers and 100 of them to businesses. f. anticipating an increase in the demand for refrigerators, an appliance manufacturer builds a new factory.

3. saving two consumers, larry and jeff, have utility functions defined over the two periods of their lives: middle age (period zero) and retirement (period 1). they have the same income in period 0 of m dollars and they will not earn income in period 1. the interest rate they face is r. larry’s and jeff’s utility functions are as follow. = 0.5 + 0.5 and = 0.5 + 0.5 for each person is between zero and one and represents each consumer’s temporal discount econ 340: intermediate microeconomics. ben van kammen: purdue university. rate. a. write the budget constraint that applies to both jeff and larry in terms of consumption in each period and ), interest rate, and m. b. what is larry’s and what is jeff’s marginal rate of intertemporal substitution? c. what is the slope of the budget constraint? d. write each consumer’s condition for lifetime utility maximization. e. re-arrange the conditions from part (d) to solve for the ratio, . f. if > which consumer will save more of his middle age income? g. if > 1 1+ , in which period will larry consume more: = 0 or = 1?