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420worksheet9 - b If the production function is Y=F(K,L)=K...

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Worksheet 9 Saving rate and Golden Rule for K in Solow’s model 1. Use the Solow model to show how the steady state of capital changes when savings rate changes. 1. a. What is the golden rule of Capital?
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Unformatted text preview: b. If the production function is Y=F(K,L)=K 1/2 L 1/2 and the depreciation rate is 0.10, what is the savings rate that maximizes consumption?...
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