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Unformatted text preview: value K t ↓ No no shift No no change in steady-state value but. .. (see class notes)---------SR: MPK ↑ LR: MPK ↓ SR: MPL ↓ LR: MPL ↑ As K t ↓→ k falls → at this k, required investment is less than actual investment → k rises back to its steady state value s ↑ Yes Actual investment per worker curve-- s*A*k α Yes increase increase increase up or down depending on…see class notes decrease increase see class notes A ↑ Yes ·per-worker production fcn. (y=A*k α ) ·Actual investment per worker curve ( s*A*k α ) ·consumption per worker curve- c Yes increase increase increase increase no change increase see class notes n Yes ·Required investment per worker curve-- i = ( δ +n)k ·consumption per worker curve- c Yes do this on your own...
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- Spring '10
- Steady State, Actual Investment, worker curve