If the marginal product of capital net of depreciation equals 7 percent and the rate of...
If the marginal product of capital net of depreciation equals 7 percent and the rate of population growth equals 2 percent, then this economy will be at the Golden Rule steady state if the rate of technological progress equals ______ percent.
2
9
5
4
Homework Answers
marginal product of capital = population growth rate +
technological progress:
0.07 = 0.02 + rate of technological progress
Rate of technological progress = 0.07 - 0.02 = 0.05 = 5%
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If the marginal product of capital net of depreciation equals 7
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