In this question, you will be asked to examine how changes in the persistence of a productivity shock affect the responses of model variables to such a shock in a Real Business Cycle (RBC) model. First, to provide you with a base that should help you in completing the tasks below, the model setup is (re-)introduced. The model has eight endogenous variables (output Yt, private consumption Ct, investment It, capital Kt+1, labour Lt, productivity At+1, wages Wt and the rental price of capital/interest rate Rt) and eight equations:1