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question is bellow PROBLEM: Calculations and Analysis Upload your answers on iLearn. This is a 4 part questions covering the SOLOW GROWTH MODEL. [13 points

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PROBLEM: Calculations and Analysis Upload your answers on iLearn. This is a 4 part questions covering the SOLOW GROWTH MODEL. [13 points total] Suppose that output per worker is given by y=6k0.5, n=0.01 (i.e.1%), d=0.09 (i.e. 9%), and that the savings rate is 10%. SHOW WORK FOR ALL CALCULATIONS. a. [2 points] Draw a diagram that shows the golden rule level of capital-labor ratio and maximum consumption (hint: c should be on y-axis). Also draw in k_max (maximum k) on the same diagram. [do not calculate, just draw] b. [5 points] Use the info above to calculate the steady state levels of the following 4 variables: capital per worker, output per worker, consumption per worker, savings per worker. c. [1 point] Now suppose that the economy is NOT yet at steady state, and that the economy is where the capital-labor ratio is equal to 9. How much is the economy investing in capital at this point? i.e. calculate the investment per worker that takes place at this level of k. d. [5 points] Use the Solow Growth model to show (GRAPH) and to discuss the impact of a FALL in population rate (n). In your discussion, elaborate on the impact of the shock on the steady state level of k, y, and c. Make sure you provide intuitive economic reasoning for the movement of the economy from the old steady state to the new steady state. LABEL DIAGRAM! (diagram 2.5 points & discussion 2.5 points)

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