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. Consider the Malthusian model and assume Y = zF (L; N) = zLN 1 ,...

. Consider the Malthusian model and assume Y = zF (L; N) = zLN 1 , 0 < < 1, and N0 N = C N , 0 < < 1. Remember that in equilibrium C = Y . (a) Find N0 as a function of N. (b) Does a positive steady-state value for N exist? If it does, Önd this steadystate value and denote it by N . Is it a stable steady state? What is the condition for the stability of the steady-state? (c) What will be the steady state of this model if = 1? Explain the short-run and the long-run e§ects of an increase in z in this case.

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