Mark's utility function is: U = p0.6 · f0.4, where p is present consumption and f is future consumption. His best feasible choice is to consume 100 now and100 in the future. Define the interest rate Mark faces.
Some of the most powerful Central Banks use negative interest rates. At the same time, in some countries, lending interest rates remain as high as 75% or more. Which of the following could be a good reason for this:
