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Business, 17.10.2019 22:00 kassandrarosario1115

Consider the simple neoclassical growth model discussed in class. assume that ini-tially the economy is in steady state equilibrium, with capital per workerk0. assumethat the depreciation rate increases from an initial valued0tod1(d1> d0). plot theinitial steady state equilibrium, considering the functionssf(k)andk(n+d). use thesame plot to show how the steady state equilibrium changes as a consequence of theincrease in the depreciation rate. is the final capital per worker (k1) higher or ? discuss.

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