Consider the Solow model with technological change. Assume time t output is given by Y =...

 

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Consider the Solow model with technological change. Assume time t output is given by Y₁ = A,K¹/³1²/3= K²/³ [E,L, 1²/3, in which E, = A³/². 1/372/3 Assume that Ą, is growing at the fixed exponential rate of 2% and thus E, is growing at the fixed rate of 3%. The growth rate of labor is 2%. Answer questions 15 and 16. [15] In this economy the steady state growth rate of y (= Y/L) is A. 2% B. 3% C. 4% D. 5% E. Neither of A-D. [16] In this economy the steady state growth rate of the marginal product of capital is A. 2% B. 3% C. 4% D. 5% E. Neither of A-D. Consider the Solow model with technological change. Assume time t output is given by Y₁ = A,K¹/³1²/3= K²/³ [E,L, 1²/3, in which E, = A³/². 1/372/3 Assume that Ą, is growing at the fixed exponential rate of 2% and thus E, is growing at the fixed rate of 3%. The growth rate of labor is 2%. Answer questions 15 and 16. [15] In this economy the steady state growth rate of y (= Y/L) is A. 2% B. 3% C. 4% D. 5% E. Neither of A-D. [16] In this economy the steady state growth rate of the marginal product of capital is A. 2% B. 3% C. 4% D. 5% E. Neither of A-D.

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