Question
Country A has a production function per effective worker given by the following expression y = k 0.5 . The savings rate of this country
Country A has a production function per effective worker given by the following expression y = k0.5. The savings rate of this country is 15 percent, the depreciation rate is 4 percent, the population growth rate is 4 percent, and the rate of technological change is 2 percent.
In the Golden-rule steady-state of this economy, what is the savings rate?
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The savings rate in the Goldenrule steadystate of this economy is not 15 the actual savings rate but rather higher Heres why The Golden rule suggests ...Get Instant Access to Expert-Tailored Solutions
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Calculus
Authors: Ron Larson, Bruce H. Edwards
10th Edition
1285057090, 978-1285057095
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