Question 2 : Solow Growth Model [35 marks] Consider the following numerical example using the Solonr growth model. Suppose that F{K, N) = Khmer\" 13, Y = 2F{K.N}. Furthermore, assume that the capital depreciation rate is d = Bill. the savings rate is s = {1.3. the population growth rate is n. = 0.1135, and the productivity is z = 1.75. Suppose Kn = 2m and ND = 1m. 1. Compute the values in. m. and c1 of the per-worker capital. output and consumption in period one. [115 marks] Find the steady state per-capita capital stock {if}. output per capita {99"}. and consumption per capita {c*]l[1 marks] Assume the economy is in the steady state of Question 2, compute the percentage change in 2 that is needed to increase the long run per capita capital by 5%. [06 marks] Assume the economy is in the steady state of lQuestion 2 and suddenly. 2 decreases by 113%., calculate the percentage change in s that is needed to keep the long run per capita output unchanged. [06 marks] . Assume the economy is in the steady state of Question 2 and it goes down by 5% while 2 increases by 5% and s increases by 5%. Using the Taylor approximation, evaluate the contribution of each variable to the total change in the steady state consumption 6\". [08 marks]