Use the intertemporal budget constraint - equation (2)- to explain how an increase in the real interest rate causes two distinct effects,an income effect and a substitution effect,and how those effects differ depending on whether the consumer is a saver or a borrower.

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The Answer of Use the intertemporal budget constraint - equation (2)- to explain how an increase in the real interest rate causes two distinct effects,an income effect and a substitution effect,and how those effects differ depending on whether the consumer is a saver or a borrower.

Use the Intertemporal Budget Constraint - Equation (2)- to Explain