Due to some objection at ¡­

Due to some objection at the last lecture, claiming that the model was incorrectly specified, I have produced "Hand-out 8 - a supplement", showing that the one outlined in Lecture Note #8 is correct - it is immaterial to the trade-offs whether we discount back to the beginning of the first period or to the beginning of the second period. You find the supplement under Teaching Material.

During a few days I will provide to you a small note related to Problem 3, seminar 5.