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Consider the Basic Solow Model with exogenous growth: Y = AK^ ( EL )^(1 ) C =(1 s ) Y Y = C + I

Consider the Basic Solow Model with exogenous growth:

Y=AK^(EL)^(1)

C=(1s)Y

Y=C+I

K=I+(1)K

L=(1+n)L

E=(1+g)E

Assume the following values for the rest of this question:

A=100

=0.35

s=0.15

=0.05

n=0.02

g=0.03

  1. Compute steady state capital per effective worker.
  2. Compute steady state output per effective worker.
  3. Compute steady state consumption per effective worker.
  4. Compute steady state investment per effective worker.
  5. In the steady state, what is the growth rate of output per worker (Y/L)?
  6. In the steady state, what is the growth rate of aggregate output (Y)?

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