Consider the model of Section 3.3 with + > 1 and n > 0. (a)

Consider the model of Section 3.3 with β + θ > 1 and n > 0.

(a) Draw the phase diagram for this case.

(b) Show that regardless of the economy’s initial conditions, eventually the growth rates of A and K (and hence the growth rate of Y) are increasing continually.

(c) Repeat parts (a ) and

(b) for the case of β + θ = 1, n > 0.