Suppose that technological change is not labour-augmenting, but affects only capital. Use the

Solow growth model of Chapter 9 to graphically illustrate the impact of the slower rate of

technological change that increases the rate at which capital wears out (the rate of depreciation

increases) on the steady-state capital-labour ratio and the steady-state level of output per worker.

Be sure to label the:

i. axes

ii. curves

iii. initial steady-state levels

iv. terminal steady-state levels

v. the direction curves shift.