Exercise 20.18. Consider the model of Section 20.3. (1) Show that aggregate food (agricultural) consumption and production stay constant at BAG(1 − φ−1(γA/BA)) = γA + BAηG0 (1 − φ−1(γA/BA))) F(φ−1(γA/BA)) F0 (φ−1(γA/BA)). (2) Show that this is increasing in BA and provide the intuition for this result. (3) Show that expenditure on agricultural goods increases at the same rate as aggregate output. [Hint: first characterize how p (t) changes along the equilibrium path].