Part 6 gave = 1 and assumes positive long run growth

3 Neoclassical and Endogenous Growth Consider the following Social Planner's problem of the neoclassical growth model: maxt=0t1ct1s.t.Ct+Kt+1=BKt(NtAt)1+(1)Kt where the risk aversion parameter is >0 and B>0 is constant over time. The population is growing at a constant rate n>0 and technology is growing at a constant rate g, that is At=(1+g)t and Nt=(1+n)t. 8. Assume that your condition for positive growth is satisfied in part 6 . Plot kt+1 against kt and also include the 45-degree line in this plot. Start the economy at some initial capital per capita k0>0 and use the diagram to trace out how the capital stock per capita evolves over time. Use this result to explain what happens to output per capita over time. 9. Repeat the previous question, but now assume that your condition for positive growth from part 6 is violated. 3 Neoclassical and Endogenous Growth Consider the following Social Planner's problem of the neoclassical growth model: maxt=0t1ct1s.t.Ct+Kt+1=BKt(NtAt)1+(1)Kt where the risk aversion parameter is >0 and B>0 is constant over time. The population is growing at a constant rate n>0 and technology is growing at a constant rate g, that is At=(1+g)t and Nt=(1+n)t. 8. Assume that your condition for positive growth is satisfied in part 6 . Plot kt+1 against kt and also include the 45-degree line in this plot. Start the economy at some initial capital per capita k0>0 and use the diagram to trace out how the capital stock per capita evolves over time. Use this result to explain what happens to output per capita over time. 9. Repeat the previous question, but now assume that your condition for positive growth from part 6 is violated