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Suppose a closed economy X is currently at steady state.the data shows that their capital stock per effective worker iS about 2times of their one
Suppose a closed economy X is currently at steady state.the data shows that their capital stock per effective worker iS about 2times of their one year's output per effective worker, about 20percent of output per effective worker iS used to replace depreciating capital, capital income per effective worker iS about 25 percent of total output per effective worker,and total output grows an average of 2percent per year. Is the economy X currently above,at or below the golden rule steady state? Provide your policy suggestion on the saving rate and explain the consequences to the economy if the government implements the policies according to your suggestion
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