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For both experiments assume the economy is on a balanced growth path starting at t=0. Experiment 1: An infectious disease destroys of the population at
For both experiments assume the economy is on a balanced growth path starting at t=0. Experiment 1: An infectious disease destroys of the population at t=50. Use Excel and plot the time path of ct and yt for the first 200 periods. Report k200, y200, and c200. 1/ 3 2 / 3 [(1.02) ]t t Yt = Kt N t t t g N K k (1 ) ^ + = k ss ^ k k ss ^ 0 = t ss kt k (1 g) ^ = + Experiment 2: In period t=50, the government enforces a new policy: s=.4 (instead of s =.2). Plot the time path of ct and yt for the first 200 periods. Report k200, y200, and c200. Compare the results. In which case is the economy richer at t = 200 richer
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