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please help answer this question 1. (2 points) Assume that the production function is Y = K=(EL) 1-4 and the growth rate of technology is

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1. (2 points) Assume that the production function is Y = K=(EL) 1-4 and the growth rate of technology is g: AE/E = g. Labor is constant: AL/L = 0. Capital accumulates with investment and investment is a fraction of output: AK = 1 - 6K, I = SY, where I is investment, 6 is the depreciation rate of capital, and s is the savings rate. a. Using the expressions for efficiency units, () = =, k = _, i = ), derive the production function in efficiency units. b. Derive the fundamental equation of capital in efficiency units. (Hint: The equation should not include output or investment.) c. What is the growth rate of capital per capita and output per capita at the steady state of this economy? What is the growth rate of capital and output at the steady state of this economy? d. Using the fundamental equation of capital in efficiency units, analyze the effect of a one-off increase in g (the growth rate of technology). That is, plot the time-series of 5 variables (E, k, ), K/L, Y/L), when g increases

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