Euler equation A representative household maximizes where [infinity] E 23* [log(C++j– ĐCt+j-1) – Xht+i], j=0 Ct+j + Kt+j = Wt+jht+j + rt+jKt+j−1 +It+j − T. 1. Discuss economic intuitions behind the term with 0. 2. Define Lagrangian.