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b. Show that there exist two steady states (graphically). Study their stability properties. Under which condition might the economy eventually end up in the low
b. Show that there exist two steady states (graphically). Study their stability properties. Under which condition might the economy eventually end up in the low k steady state? Explain the intuition. c. Does this model have implications for the question of convergence? That is, whether countries are converging to similar per ca pita income? d. Suppose that the economy is in the low it steady state. Could a donation from an international aid agency help the country out of its "poverty trap"? If so, what is the minimum donation required? IE. Could a change in the savings rate, 3, lift the economy out of its poverty trap without outside assistance
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