Suppose that n 1 delta k gt gammafk and that n2 delta k

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Consider the Solow model with population growth, as presented in the text. Assume that population can grow at two different rates n1 and n2, where n1 > n2. The population growth rate depends on the level of output per capita (and therefore the level of capital per capita). Specifically, population grows to rate n1 when k< k and slows down to rate n2 when k≥k. Draw a diagram for this model. Assume that (n 1 + δ) k > γf(k) and that (n2 + δ) k < γf(k). Explain what the diagram says about the steady state of the model.

Reference no: EM13394043

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