If the production function is y = k1/4, δ = 0.05, and k = 20, then the saving rate is _____ the Golden Rule level.greater thanless thanthe same aserratic compared to

If the production function is y = 2k1/2 and δ = 0.1, then the Golden Rule level is reached when k is:200.150.120.100.

In an economy where consumption, savings and output is dictated by the basic Solow model, the per worker production function is given as: y= . Capital depreciates at a rate of 0.2. The savings rate is currently 0.4. What is the golden rule level of output per worker?A.6.25B.2.5C.0.5D.2

If an economy is not in a golden rule steady state, it represents its s(current) is not equal to s(golden rule). Choose the option(s) that correctly reflect the change on y, c, i after the adjustment of saving rate to the Golden Rule level.

In the Solow growth model, initially, the economy is in its steady state, at which the saving rate is lower than the Golden Rules saving rate. Suppose the saving rate is raised to the Golden Rules saving rate, which of the following is true for the effect on consumption per worker?A.Consumption per worker is always higher than the initial steady-state level of consumption in both the transition path and the new steady state.B.Consumption per worker is always lower than the initial steady-state level of consumption in both transition path and in the new steady state.C.Consumption per worker may be higher or lower than the previous steady-state level of consumption per worker on the transition path, but the new steady level of consumption per worker is higher.D.Consumption per worker may be higher or lower than the previous steady-state level of consumption on the transition path, but the new steady level of consumption per worker is lower.

Two countries, Alpha and Beta, have the same Cobb-Douglas production function: . Suppose the Solow growth model with population growth and technological progress describes both economies. The parameters of the two economies are indicated in the table below.Based on the above information, answer the following questions.In which country will the Golden Rule level of capital per effective worker be higher? Briefly explain your answer. (Note: No calculations are required). (2 marks)Which country will have the higher Golden Rule saving rate? (Note: No calculations are required). (1 mark)Suppose the saving rate of Beta falls to 15%. What will happen to the steady-state level of income per effective worker in response to the saving rate change? (Note: No calculations are required). (1 mark)