1) Does a positive savings rate mean that capital per worker will definately rise over time ? Explain why or why not.

2) Assume Y = A*K^{.6}*L^{.4}

a) In equation form- what is the marginal product of capital ?

b) In equation form what is the marginal product of labor ?

c) How do we know that each is diminishing.

d) Prove that if you double capital and labor Y doubles.

e) What is the characteristic described in d called in words ?

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