4. Explain the expanding variety model (Romer (1990)). Assume no population growth. Suppose that in the model there is a government that subsidizes the purchases of all the intermediate goods at a rate l-T, that is the producers of the final good will pay a fraction T of the priced charged by the producers of the intermediate goods. The subsidy is nanced with a lump-sum tax on the households. Obtain the growth rate of total output. the growth rate of the quantities of intermediate capital goods produced and the growth rate of the number of varieties of the intermediate goods along the balanced growth path. (30 marks)