Solutions Problem Set 2 Macro II (14.

452)
Francisco A. Gallego
04/22
We encourage you to work together, as long as you write your own solutions.
1 Intertemporal Labor Supply
Consider the following problem. The consumer problem is:
'ar
fctg,ftg
1
0
_
|=T

|=o
,
|

1
C
u1
|
+
2

u2
|

_
:.t.

|+1
= 1(
|
+
|
\
|
C
|
)
Where C is consumption, is labor supply,
0
is initial wealth, 1 = 1 +r,
and the greek letters are parameters. Only \ is stochastic
1). Derive and interpret the rst-order conditions for C
|
and
|
.
What are the intertemporal and intratemporal optimal conditions
There are at least two (equivalent ways of setting up and solving this prob-
lem). I will implement both of them
1. Lagrangian method I:
In this case the Lagrangian is:
'ar
fctg,ftg,f.t+1g
$ = 1
0
_
|=T

|=o
,
|

1
C
u1
|
+
2

u2
|
`
|
(
|+1
1(
|
+
|
\
|
C
|
)
_
s.t.
0
F.O.C.
C
|
:
0$
0C
|
= 0 =
1
c
1
C
u
1
1
|
= `
|
1 (1)
1

|
:
0$
0
|
= 0 =
2
c
2

u21
|
= `
|
\
|
1
The interpretation is more or less natural. The rst condition tells you
that the marginal utility of C
|
has to be equal to the marginal utility of
wealth (do not worry too much about Rit is an implication of the fact
that C in this case is realized at the beginning of the period tso the value
of saving one unit of consumptions is 1 times R). The second condition
tells you that marginal disutility of work has to be equal to the marginal
utility of wealth times how much consumption you can get from one our
of work (the wage rate). Why no expectation? This is important, at time
t, the only source of uncertainty is realized (\
|
) and, roughly speaking,
`
|
is a function of expected future wages (see below).
Combining both equations we get the intratemporal condition:

2
c
2

u21
|
= \
1
c
1
C
u
1
1
|
To get the intertemporal condition, we need another FOC:
0$
0
|+1
= 0 = ,
|
`
|
= ,
|+1
`
|+1
1
Using the FOC for consumption, we get our intertemporal condition:
,
|

1
c
1
C
u
1
1
|
= ,
|+1
1E(
1
c
1
C
u
1
1
|+1
)
1 = ,1E
_
_
C
|+1
C
|
_
u
1
1
_
2. Lagrangian method II:
Notice that you can iterate the constraint and write the intertemporal
budget constraint.
T

|=0
1
|
C
|
=
0
+
T

|=0
1
|

|
\
|
Two comments: (1) Why no expectation? This has to hold exactly. (2)
what about
T+1
?
'ar
fctg,ftg
$ = 1
0
_
|=T

|=o
,
|

1
C
u1
|
+
2

u2
|
`(
T

|=0
1
|
C
|

0

T

|=0
1
|

|
\
|
)
_
F.O.C.
2
C
|
:
0$
0C
|
= 0 = ,
|

1
c
1
C
u
1
1
|
= `1
|
(2)

|
:
0$
0
|
= 0 = ,
|

2
c
2

u21
|
= `\1
|
(3)
If you combine both equations, you get the same intratemporal condition
as before.
To get the intertemporal condition write the FOC for t + 1 taking expec-
tations at t.
C
|+1
:
0$
0C
|+1
= 0 = E
|
_
,
|+1

1
c
1
C
u
1
1
|+1
`1
|1
_
= 0
Using the FOC for C
|
:
E
|
_
,
|+1

1
c
1
C
u
1
1
|+1

1
,
|
c
1
C
u
1
1
|
1
|1
_
= 0
and you get the same as before:
1 = ,1E
_
_
C
|+1
C
|
_
u
1
1
_
What is more interesting about this method is that ` can be interpreted
as the sucient statistic you need to solve the problem.
Notice that (1) and (2) imply that:
`
|
1 = `(,1)
|
How can you interpret this condition?
We can plug (1) and (3) into the budget constraint and we will get a
decreasing implicit function of ` as a function of \
I
with i _ t and, of
course, some constant terms (among them 1). Thus, the only thing you
need to compute ` is to know something about \
I
. Therefore, you will
keep your ` constant in the future if the realizations of \
I
were more
or less what you expected in the past.
2). What is the link between C
|
and
|
in this model? What
assumption(s) is (are) producing this result
The only link between both variables is ` (or `
|
). This implies the intratem-
poral condition and the negative correlation between both variables if \ is kept
constant. And, the lack of correlation if \ increases without aecting `.
Assumption: (1) both terms are additively separable in the utility function
and (2) perfect capital markets (what may happen if we introduce frictions as

|
0)
3
3). How can you analyze changes to wages that do not aect the
expected wealth of the consumers? (Hint: what is `the Lagrange
multiplierin this model?). Lets dene the wealth-constant elasticity
of labor supply as j =
J ln t
J ln Vt
when wealth is constant. What is j in
this model? Is it positive or negative? Why?
Given our previous discussion, these are changes that do not aect `, there-
fore we can take logs in (3) and get:
log(

2
c
2
`(,1)
|
) + (c
2
1) log(
|
) = log \
|
Then
j =
log(
|
)
log \
|
=
1
(c
2
1)
Notice that j 0. There are several ways of understanding this. Here is
one:
First, notice that obviously
1
0,
2
< 0, c
1
< 1. Why? People like C,
dislike , and marginal utility of consumption is decreasing in general. There-
fore if the instantaneous utility function is to be concave (and, therefore, the
solution we just proposed has sense), it has to be true that:
0
2
l
0
2
=
2
c
2
(c
2
1)
u
2
2
|
< 0 = (c
2
1) 0
4). Take the FOCs and discuss the eect of the following situations
on C
|
and
|
.
1. Cross-sectional dierences associated with permanent dif-
ferences in human capital (assume \ varies in the cross-
section)
Higher human capital will probably imply higher \. Therefore, ` |,
C .
What about ? Assume all other parameters do not vary in the
cross-section and take two individuals i and ,
log(

I
) =
1
(c
2
1)
_
log
\

\
I
+ log
`

`
I
_
So eect is ambiguous. One of them is richer, but at the same time
the alternative cost of leisure is higher.
Life-cycle changes in wages (i.e. if Mincerian equations are
correct, wages follow an inverted-U behavior over the life-
cycle)
Notice that these evolutionary changes were predictable at the be-
ginning of the life-cycle and, therefore, as \ changes, ` is constant.
Thus C is also constantsee (2). But given that j 0 and ` is
constant, moves together with \.
4
Unexpected temporary shocks to wages
If change is temporary, it shouldnt aect ` by much, then C is
constant, and moves together with \.
Unexpected permanent shocks to wages
In this case ` should be aected. Therefore, C moves in the same
direction as \ and the eect on is unclear.
2 Log-Linear RBC
Consider the following problem. Consumers maximize
max 1
|
_
_
1

=0
/

l(

C
|+
,
|+
)
_
_
Subject to

1
|+1
= 1
|

1
|
+

\
|

|


C
|
l(

C
|
,
|
) = log
_

C
|
_
+clog(1
|
)
while rms solve
_

|
,

1
|
_
= arg max
,
e
1
7
|
1(
|
,

1) (1
|
+c 1)

1

\
|

1(
|
,

1) = 1 = 7

1
1o
(
|
)
o
and we assume

|+1
=
|
.
This is the standard RBC model. trending variables are those with a hat.
1) De-trend the model
Dene \ =
e
\
.
.
1. Utility function:
l(C
|
,
|
) = log (C
|

|
)+clog(1
|
) = log (
|
)
. .
Does not matter
+log (C
|
)+clog(1
|
)
2. Consumers B.C.1
|+1

|+1
= 1
|
1
|

|
+\
|

|
C
|

|
1
|+1

|+1
= 1
|
1
|

|
+\
|

|
C
|

|
= 1
|+1

|+1

|
. .
~
= 1
|
1
|
+\
|

|
C
|
= 1
|+1
= 1
|
1
|
+\
|

|
C
|
5
3. Prots

|
, 1
|
= arg max
,1
7
|
(1
|

|
)
1o
(
|
)
o
(1
|
+c 1)
|
1
|

|
\
|

|
=
|
, 1
|
= arg max
,1
7
|
(1
|
)
1o
()
o
(1
|
+c 1) 1
|
\
|

|
2)Solve for the 1.O.C of the consumer problem, either using a La-
grangian or a Bellman Equation. You should nd two nal equations,
the Euler Equation and the labor supply.
1. Bellman equation
\ (1) = 'ar
c,
log (C) +clog(1 ) +/E[\ (1
0
)]
:.t.
1/ = 11 +\ C
FOC:
0\
0C
=
1
C
+/E
_
0 [\ (1
0
)]
01
0
01
0
0C
_
=
1
C

/

E
_
0 [\ (1
0
)]
01
0
_
= 0 (4)
0\
0
=
c
1
+/E
_
0 [\ (1
0
)]
01
0
01
0
0
_
=
c
1
+
\/

E
_
0 [\ (1
0
)]
01
0
_
= 0
(5)
Envelopment theorem:
0\
01
= /E
_
0 [\ (1
0
)]
01
0
01
0
0C
_
=
1/

E
_
0 [\ (1
0
)]
01
0
_
(6)
(a) Euler Equation:
Using (15) and (4), we get:
0\
01
=
1
C
Then, we get:
1
C
=
/

E
_
1
0
C
0
_
= 0
(a) Labor supply
(5) and (4) imply:
1 =
Cc
\
(7)
6
2. Lagrangean:
'ar
fctg,ftg
$ = 1
_
|=T

|=o
/
|
log (C) +clog(1 ) `
|
(1
|+1
(1
|
1
|
+\
|

|
C
|
))
_
FOC
C
|
:
1
C
= `
|
(8)
C
|
:
c
1
= `
|
\
|
(9)
From (5) and (4) we get:
1 =
Cc
\
(10)
Take additional FOC:
1
|+1
: ,
|
`
|
= E
_
,
|+1
`
|+1
1
|+1

(11)
Then, combining (16) and (11), we get our Euler equation:
,
|

1
C
|
= E
_
,
|+1
1
C
|+1
1
|+1
_
= 1 = ,
|

1
C
|
= E
_
,

C
|
C
|+1
1
|+1
_
3)Solve the rm problem to nd the labor and capital demands.
Give the law of motion for capital (re-write

1
|+1
= 1
|

1
|
+

\
|

|


C
|
to get the usual equation)
This should be easy.
=
|
, 1
|
= arg max
,1
= arg max
,1
7
|
(1
|
)
1o
()
o
(1
|
+c 1) 1
|
\
|

|
FOC:

|
:=
0
|
0
|
= 0 = c7
|
_
1
|

|
_
1o
= \
|
1
|
:=
0
|
01
|
= 0 = (1 c) 7
|
_

|
1
|
_
o
= (1
|
+c 1)
4) We have a total of 5 equations. Discuss how would you proceed
to log-linearize our system (you dont need to do all the math, just
apply the method to one or two equations).
There is no unique way of log-linearize things. I will use here my way (which
I think is simpler and does not use any math trick you didnt know). Let go
one by one:
7
1. Consumers BC:
1
|+1
= 1
|
1
|
+\
|

|
C
|
= 1
|+1
= (1 c)1
|
+1
|
C
|
It is also true that (where A denotes the steady state of A):
1 = (1 c)1 +1 C
Then:

_
1
|+1
1
_
= (1 c)
_
1
|
1
_
+ (1
|
1 )
_
C
|
C
_

_
1
|+1
1
_
1
= (1 c)
_
1
|
1
_
1
+
(1
|
1 )
1
1
1

_
C
|
C
_
C
C
1
Dene r
|
= log (A
|
) log
_
A
_
-
(t)

= /
|+1
= (1 c)
1
1
/
|
+j
|

C
1
c
|
(12)
But, take the production function (Ill skip some steps):
= j
|
= .
|
+c:
|
+ (1 c) /
|
Then (12) becomes:
/
|+1
+
_
1 c + (1 c)
1
1
_
/
|

C
1
c
|
+c
1
1
:
|
+
1
1
.
|
= 0
2. The wage equation:
c7
|
_
1
|

|
_
1o
= \
|
It is also true that
c7
_
1

_1o
= \
Then
7
|
7
_
1
|
1

|
_1o
=
\
|
\
Take logs and use small letters to denote log deviations from the steady
state and you get:
.
|
+ (1 c)(/
|
:
|
) = n
|
8
3. Labor supply
1
|
=
C
|
c
\
|
1 =
Cc
\
Then,
1
1
|
=
C\
|
C
|
\
Take logs
log(
1
1
|
) = n
|
c
|
(13)
Lets dene 1 = 1 and | = log(1) log(1).
Then, the LHS can be written as:
log(
1
1
|
) =
1
|
-
1

-
1
:
=
:
_
1
_

Then, (13) becomes:

:
_
1
_

= n
|
c
|
So there is a mistake in the log-linearization that appears in the program.
4. Price of capital
As with the wage equation:
(1 c) 7
|
_

|
1
|
_
o
= (1
|
+c 1)
Then (after some steps)
7
|
7
_

1
1
|
_o
=
(1
|
+c 1)
_
1 +c 1
_
Take logs:
.
|
+c:
|
c/
|
-
(1
|
+c 1)
_
1 +c 1
_
_
1 +c 1
_ =
1
|
1
_
1 +c 1
_ -
1
_
1 +c 1
_r
|
9
5. Euler equation
1 = E
_
/

C
|
C
|+1
1
|+!
_
1 =
_
/

C
C
1
_
Then,
1 = E
_
C
|
C
C
C
|+1
1
|+1
1
_
= E[(1 +c
|
) (1 c
|+1
) (1 +r
|+1
)] - E[1 +c
|
c
|+1
+r
|+1
]
5) Our log-linearized system is the following (small variables denote logs):
The law of motion and the market clearing conditions:
/
|+1
+
_
1 c + (1 c)
1
1
_
/
|

C
1
c
|
+c
1
1
:
|
+
1
1
.
|
= 0
c
1 c
c
(/
|
:
|
) n
|
+.
|
= 0
1

cc
|
+:
|
c
1

n
|
= 0
c/
|
+
1
1 +c 1
r
|
c:
|
.
|
= 0
The Euler Equation (or any other asset pricing equation):
1
|
[r
|+1
c
|+1
] +c
|
= 0.
We assume
.
|
= j.
|1
+-
|
.
We want to write the system of six equations in order to solve it numerically
using the process in Uhlig(1997). Let :
|
be the vector of endogenous state vari-
ables (capital stock), r
|
= [c
|
; r
|
; :
|
; n
|
]
0
the endogenous control variables and
.
|
the stochastic processes. To avoid confusion, matrices are named using two
capitalized letters. There are two conceptually dierent sets of equations. The
rst set describes the law of motion of the economy, together with the market
equilibrium conditions: I use '_ for these matrices (Motion and Market). In
the second set, the equations are forward looking and they involve the expecta-
tions of the agents: I use 1_ for these equations (Forward). Finally, we have
the equation for the stochastic process .
|
. Write the system in the following
way:
'o
1
+ :
|+1
+'o + :
|
+'A + r
|
+'7 + .
|
= 0
1
|
[1o
2
:
|+2
+1o
1
:
|+1
+1o:
|
+1A
1
r
|+1
+1Ar
|
+17
1
.
|+1
+17.
|
] = 0
.
|+1
77 + .
|
-
|+1
= 0.
10
In other words, what does each matrix contain?
Just by inspecting the log-linearize system we get:
'o
1
=
_

0
0
0
_

_
, 'o =
_

_
_
1 c + (1 c)
Y
1
_
(1 c)
0
c
_

_
,
'A =
_

c
1
0 c
c
1
0
0 0 (1 c) 1
1

0 1
1

0
1
1+o1
c 0
_

_
, '7 =
_

_
Y
1
1
0
1
_

_
1o
2
= 0,1o
1
= 0,1o = 0,1A1 =
_

_
1
1
0
0
_

_
0
, 1A =
_

_
1
0
0
0
_

_
, 17
1
= 0,17 = 0
0
6) We want to nd numerically a solution of the type
:
|+1
=

o + :
|
+

o7 + .
|
r
|
=

A + :
|
+

A7 + .
|
,
because we are looking at small deviations from steady state. You have to solve
that using matlab. I give you a program, linear, containing the function linear
which does the solution of the system, so basically what you have to do is create
a program containing the following:
a) Values of the parameters of the model. We will assume
c = 0.025, = 1.004, c =
2
3
, c = 1, j = .979,
1 = 1.0163, 1,1 = 1,2,4, 1 = 1, C = 1 + 68,100,
= .2, o
t
= .0072
Before solving the problem, notice that we need a few clarications here:
There are some conditions that the steady state values have to satisfy:
(1 c) 7
_

1
_o
= (1 c)
_
1
1
_
=
_
1 +c 1
_
=
_
1
1
_
=
_
1 +c 1
_
(1 c)
= 3 (0.0163 + 0.025) -
1
8.0701
11
So
_
Y
1
_
is not a parameter that you can change.
1 = (1 c)1 +1 C =
C
1
= (1 c ) +
1
1
=
C
1
= (1 c )
1
1
+ 1 - 8.0701(0.025 0.004) + 1 - 0.7629
So the value that is in the PS is inconsistent with the budget constraint.
Sorry about that.
Moreover,
1 =
Cc
\
=
Cc
c
_
Y

_ =
_
c
Y
_
c
c
= =
1
1 +

C
Y

o
- .3180
So, if we want to have = 0.2, we need c ,= 1! Fortunately, this does
not aect the simulations Olivier showed in class because it is the sum of two
mistakes that cancel out each other. In any case, keep in mind that if you change
you have to change c. This is completely intuitive because c is a measure of
how much you value leisure. Notice that if c = 0, then = 1.
b) The matrices derived in 5).
c)Then you have to call the function linear.
7) Now we want to do impulse-response functions. For that, attach
to your program (copy and paste after part c)) the program linear 2.
This programs calls two other functions, impulse and impulse-plot.
The rst nds the reduced form model and the second hits it with a
shock. That should be the end of your program. Explain the results.
How do they depend on the values assumed in a)? (run the program
for dierent values of at least two parameters and compare results).
Interpret.
Several exercises can be implemented:
Base case (Figure 1)Minor dierences with the gure Olivier showed in
class, same intuition.
12
Baseline case
Change j to 0.999 and 0.300 (Figures 2 and 3)
j = 0.999
13
j = 0.9
Change = 0.8 (Figure 4).
= 0.8
1 = 1.1 (Figure 5)
14
1 = 1.1
= 1.01 (Figure 6)
= 1.01
3 (Optional) Discrete Time Dynamic Program-
15
ming
1
Use the discrete time setup of Philippon and Segura-Cayuela (2003) (up to sec-
tion 5) and the MATLAB programs contained in the folder 1j:a:ic1roqra::i:q.
Read tntoria|.doc and the comments in 11.:.
1) Derive the Euler equation in discrete time in the model with
exogenous labor, rst using dynamic programming and then using
the Lagrange multiplier method. Compare it to the continuous time
Euler equation.
The problem is:
'ar
fctg
$ =
|=1

|=o
/
|
o
o 1
_

C
|
_
1

:.t.

1
|+1
= 1
|

1
|
+

\
|


C
|

|+1
=
|
Divide all the trending variables by
|
.Dene \ =
e
\
.
and notice that
|
=

|
Utility function:
'ar\ = 'ar
|=1

|=o
/
|
o
o 1
_
C
|

|
_
1

= 'ar
1

0
|=1

|=o
_
/
1

_
. .
o
|
o
o 1
(C
|
)
1

= 'ar
|=T

|=o
,
|
o
o 1
(C
|
)
1

The budget constraint (same as before):

1
|+1
= 1
|
1
|
+\
|
C
|
Thus, the problem becomes 'ar
|=T

|=o
,
| c
c1
(C
|
)
1

s.t. 1
|+1
= 1
|
1
|
+
\
|
C
|
Bellman equation
1
This exercise is optional in the sense that you could skip it if you feel comfortable with
stochastic DP, and do it if you want to get more training.
16
\ (1) = 'ar
c
_
|
c
o 1
(C)
1

+,E[\ (1
0
)]
_
:.t.
1/ = 11 +\ C
FOC:
0\
0C
= C

1
e
C
+,E
_
0 [\ (1
0
)]
01
0
01
0
0C
_
= C

1
e
C

,

E
_
0 [\ (1
0
)]
01
0
_
= 0 (14)
Envelopment theorem:
0\
0C
= ,E
_
0 [\ (1
0
)]
01
0
01
0
0C
_
=
1,

_
0E[\ (1
0
)]
01
0
_
(15)
Using (15) and (4), we get:
0\
01
= 1C

1
e
C
Then, we get:
1 =
,

E
_
_
1
0
_
C
0
C
_

1
e
C
_
_
But notice that:
,

= /

1
e
C
Then
1 = /E
_
_
1
0
_
C
0
C
_

1
e
C
_
_
Lagrangean:
'ar
fctg
$ =
|=1

|=o
,
|
_
o
o 1
(C
|
)
1

`
|
(1
|+1
(1
|
1
|
+\
|

|
C
|
))
_
FOC
C
|
: C
1

|
= `
|
(16)
1
|+1
: ,
|
`
|
= E
_
,
|+1
`
|+1
1
|+1

(17)
Then, combining (16) and (11), we get our Euler equation:
,
|
C
1

|
= E
_
,
|+1
C
1

|+1
1
|+1
_
= 1 = E
_
,

_
C
|
C
|+1
_1

1
|+1
_
17
Continuous time
'ar
fctg
1
_
0
o
o 1
_

C
|
_
1

exp(0t) dt
:.t.

1
|
= (1
|
1)

1
|
+

\
|


C
|

|+1
=
|
Detrending:
'ar
1
_
0
o
o 1
_

C
|
_
1

exp(0t) dt = 'ar
1
_
0
o
o 1
(C
|

|
)
1

exp(0t) dt
= 'ar
1

0
1
_
0
o
o 1
(C
|
)
1

()
|
1

exp(0t) dt
Notice that ()
1

= exp
_
log
(
1

)
_
= exp
__
c1
c
_
log ()
_
- exp
__
c1
c
_
j
_
,
1 +j = .
Then
'ar
1

0
1
_
0
o
o 1
(C
|
)
1

()
|
1

exp(0t) dt
= 'ar
1
_
0
o
o 1
(C
|
)
1

exp
_

_
0
_
o 1
o
_
j
_
t
_
dt
= 'ar
1
_
0
o
o 1
(C
|
)
1

exp(jt) dt
with
_
0
_
c1
c
_
j
_
= j
The budget constraint becomes

1
|
= (1
|
j 1)1
|
+\
|
C
|
Then the Euler equation will be:

C
|
C
|
= o(1
|
j j 1) = o(1
|
j
_
0
_
o 1
o
_
j
_
1)
= o(1
|

j
o
0 1)
18
2) Numerical analysis using 11.:. Describe the dynamics of the economy
when it starts far away from its steady state (say 30% below). How does the
recovery depend on the evolution of productivity? What does it tell you about
the rapid growth in Europe after the second world war? (Hint: for the question
on the evolution of productivity you may want to replicate the model, say 100
times, and see what happens with the recovery path)
See gures
Evolution of output after the recovery (Figure 7):
Recovery
Mean and median and max and min in 100 simulations (Figures 8 and 9)
19
Mean and median (100 recoveries)
Fastest and Lowest Recovery (100 simulations)
3)11.: produces 5 plots. Describe briey each of them (what they represent
and how they are computed. I am not asking for the details of the computations.
20
Simply show me that you understand the architecture of the program).
Figure 1: 3D graph showing optimal consumption as a function of real-
izations of Z and initial capital stock. By-product of the search for the
policy rule.
Figure 2: Policy rule. 1
|+1
as a function of 1
|
. Capital in the steady
state goes from 4.6 to around 5.4
Figure 3: Evolution of consumption in a stochastic simulation after start-
ing from some initial capital that is below the steady state value.
Figure 4: Evolution of consumption in the same simulation.
Figure 5: stationary distribution of capital in the steady state.
5) Numerical analysis using 11.:. We have seen in the continuous time
setup that the reaction of consumption to a positive technology shock depends
on the elasticity o. Use the policy function estimated by 11.: to illustrate this
nding. (note: in the program, they dene qa::a, the C11 instead of o.
How are they related? Why?) Hint: 11.: produces 5 plots. The rst one is
called consumption, and it is 3 dimensional. Consumption is measured on the
vertical axis. The two horizontal axis are for 1 and 7. If you do not see well,
you can rotate the picture with the mouse.
Notice that C11 = o
1
Dierent o = 0.1, 1, 10 Figures 10 to 12.
21
o = 0.1
o = 1
22
o = 10
6) Show numerically how the behavior of consumption is aected by the
persistence of the shocks. Interpret.
Dierent j = 0.05, 0.99
j = 0.05
23
j = 0.99
24