Question: PLZ PLZ HELP Consider the following aggregate production function (Y) for economy X, which exhibits constant returns to scale and diminishing marginal productivity of capital

PLZ PLZ HELP

PLZ PLZ HELP Consider the following aggregate production function (Y) for economyX, which exhibits constant returns to scale and diminishing marginal productivity ofcapital (K) and effective labour (A . L): Y = F(K, A

Consider the following aggregate production function (Y) for economy X, which exhibits constant returns to scale and diminishing marginal productivity of capital (K) and effective labour (A . L): Y = F(K, A . L) where A stands for the level of technology. The population saving rate for economy X is s. Change in capital per effective worker is written as: K - (g + 8 + n) where & is the depreciation rate, g is the "technological progress' rate, and n is population growth rate.a. Derive the intensive-form production function from the aggregate production function. Explain why the assumption of constant returns to scale allows us to derive an intensive-form production function? (5 marks} b. Discuss the impact of investments savings on the rate of change in capital per effective worker and growth of output per effective worker. To what extent does this depend on where economy X's gresent level of capital per effective worker is in relation to its steady state level of capital per effective worker? {10 marks) c. Can changes in the savings rate (5), population growth rate {11) and depreciation rate (:5) ever cause growth in output per effective worker? Does capital accumulation sustain output growth in the long run? (5 marks) d. Explain whv some policies have fevei effects whilst some have a growth effect. e. Discuss, using the Solow model, why some underdeveloped countries are exhibiting higher growth rates of output per capita than developed countries (such as the UK), of which whom have a higher level of output per capita

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