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Q. Suppose the parameters of the Romer model take the subsequent values: A0 = 100, l = 0.06, z = 1/3,000 also L = 1,000.
a. Calculate the initial level of output per person, the growth rate of output per person also the level of output per person after 100 years.
b. Consider four possible changes, one at a time: a doubling of the initial stock of knowledge A0, a doubling of the research share l, a doubling of the research productivity z also a doubling of the population L. If you could advocate one of these four changes, which would you select? Present your argument in favor of your choice below.
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