1.Consider the Solow Growth Model when answering the questionsbelow.

a.What is the condition that must hold at steady state? Write down the equation only! Do notdiscuss.

b.Draw the diagram showing k* (i.e. the optimal capital-labor ratio). Labeleverything.

c.Draw a diagram that relates capital-labor ratio to consumption per worker at steady state.On your diagram show kG and the consumption that is associated withkG.

d.If the savings rate is 20%, depreciation is 8%, population growth rate is 2% and output per worker is 100 at steady state, what is k* and c* at steady state? Calculate. SHOW WORK.

e.Show the impact of a rise in n on the steady state of capital-labor ratio. Carefully draw andlabelthediagram.ClearlySTATEtheimpactonk*,c*,andy*anddiscusstheimpact.