🌿(PART 2) Intertemporal Consumption-Solving for Optimal Consumption, Borrowers vs Lenders🌿

In this Part 2 video on Intertemporal Consumption, we build directly on Part 1. After deriving the Intertemporal Budget Constraint and the tangency condition earlier, this lesson shows how to solve both conditions simultaneously to obtain optimal current and future consumption. We then explore the economic intuition behind the results by examining how changes in interest rates and income affect consumers differently depending on whether they are borrowers or lenders. #macroeconomics #intertemporalconsumption #emfss #uol #lse #economics #microfoundations #consumptiontheory #intertemporalchoice #studywithme #universityoflondon #aminateaches #studentsuccess #economicsmadeeasy