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Part 2) Consider the capital accumulation equation: K+1 = It + (1 6) Kt. This equation should hold for any t. For this question, assume
Part 2) Consider the capital accumulation equation: K+1 = It + (1 6) Kt. This equation should hold for any t. For this question, assume that It is a constant equal to its steady state value I33. a) Argue that if capital is at steady state, then
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