Suppose that in the Solow growth model the saving rate is 30
percent (s=0.03), population growth rate is 2 percent (n=0.02),
depreciation rate is 8 percent (d=0.08), and production fuction is
F(K,N)=zK^0.4N^0.6.
a) Suppose that z=2. What is the steady state level of captial
per worker and consumption per worker?
b) What is the level of golden rule savings and golden rule
capital stock? At the golden rule capital stock, what is the level
of consumption per worker?
c) Suppose...