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Unformatted text preview: k using the boundary condition ( T ) = a . This implies that k = ae T and so ( t ) = ae ( t T ) . We can use the rst order condition and the expression for ( t ) to write the optimal policy function q ( t ) as a function of T q ( t ) = a 2 b + c (1 e ( t T ) ) (6) The only unknown is T . 3. The resource is exhausted at T and so the condition that determines T is Z T t =0 q ( t ) dt = R (7) where R is the initial reserve of the stock. The Planners problem is solved in the same manner. 1...
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This note was uploaded on 08/01/2008 for the course ARE 263 taught by Professor Karp during the Fall '06 term at University of California, Berkeley.
- Fall '06