Suppose now that the production function isY=Asquare root of K, where A is technological knowledge,

Investment isI=0.1Y

and Depreciation isD=.05K

Suppose that one year, a scientific breakthrough causes A to increase from 5 to 10. Draw the Solow model diagram for this scenario. Be sure to include the production, investment, and depreciation functions both before and after the change in A. Make sure to label all curves and the axes. Label the steady-state of capital, both before and after the change in A.

(Note: you don't need to solve for the steady-states, just mark where they would be on the graph)

Heres an example of a similar graph:

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