a）Assume that country A has the following production function Y=K^0.3 L^0.7 Its saving rate is 20%...
a）Assume that country A has the following production function Y=K^0.3 L^0.7
Its saving rate is 20% per year. The depreciation rate is assumed to be 5% per year. What is the steady state level of capital stock per capital, K*？What is the steady state level of output per capital, Y*? What is the steady state level of c*? Show the results in a suitable diagram.
b) At year 1,K=6. Is this a steady state? Find out the values of GDP per capital (y) in year 1 and 2. Calculate the growth rate y from year 1 to year 2.
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a）Assume that country A has the following production function
Y=K^0.3 L^0.7
Its saving rate is 20%...
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1. Country A and country B both have the production function Y = F(K,L)= VKL. (5...
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