In the Baumol-Tobin model,given that total costs for an individual equals ,where T0 = monthly income,b = brokerage costs,and C = amount raised from each bond transaction,derive the so-called square root rule.

Question

In the Baumol-Tobin model,given that total costs for an individual equals  ,where T0 = monthly income,b = brokerage costs,and C = amount raised from each bond transaction,derive the so-called square root rule.

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The Answer of In the Baumol-Tobin model,given that total costs for an individual equals  ,where T0 = monthly income,b = brokerage costs,and C = amount raised from each bond transaction,derive the so-called square root rule.

In the Baumol-Tobin Model,given That Total Costs for an Individual