1- Derive an algebraic expression for the inter-temporal budget constraint using c1 and c2 as period 1 and 2 consumption levels, p1 and p2 as period 1 and 2 price levels, and ρ as the real interest rate

2- Is it better to be a borrower or a lender when ρ falls? Use indifference curve analysis to explain your answer.

3- Explain, with reference to second-degree price discrimination, how a firm can increase its profits by making its product less attractive.

4- . Explain why the stability of collusion depends on the interest rate.

5- Critically evaluate the claim that in a Bayesian Nash equilibrium it is the follower who leads.

6- What type of adverse selection might occur in an insurance market?

7- How might an insurance company avoid adverse selection?