Q2. In answering the following questions, use the Solow-Swan model of a closed economy without government, described below. Population growth and labour-augmenting technical change are allowed for and the economy has clearing factor markets (prices adjust to ensure that quantities demanded equal quantities supplied). Output: Y = K"(EN) 1-Q Labour supply growth: n = 0.05 Labour augmenting technical change: Expenditure on GDP: Y =C+I Consumption: C = (1 -S)Y Savings: S = SY = Y - C where s is the average saving rate (S/Y) and it is constant Investment: I = S Depreciation: dK where the parameter values are: Production function: a = 0.5 Depreciation rate: d = 0.05 In the above described production function, E denotes the technical efficiency units per worker (i.e. labour-augmenting technology) and EN is number of effective workers. Unless otherwise indicated, there is no technical change, so that E is constant (assuming E = 1 for simplicity) and, therefore, g = 0