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Q.1. Suppose that the production function is given byY=4K^(0.4)L^(0.6),(20p)a) Can this production function be classified...

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Economics

Q.1. Suppose that the production function is given by

Y=4K^(0.4)L^(0.6),(20p)

a) Can this production function be classified as neoclassicalproduction function? [Does the production function satisfy therequired conditions?] Explain b) By referring to the Solow model,derive the steady-state levels of output per worker and capital perworker in terms of the saving rate,

s

, the depreciation rate,

\delta

and population growth rate

n

. c) Suppose that

\delta =0.05

and population growth rate is zero. Compute the steady-stateoutput per worker and consumption per worker when

s=0.2

. d) There is a value of s that maximizes consumption perworker. What is this value? Why it is different from the value insection c

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