Suppose that you have a standard solow model. the central equation governing the dynamics of the level of capital is given by (5.18). in terms of capital per worker, the central equation is given by (5.19). the production function has the normal properties (a) suppose that the economy initially sits in a steady state in terms of the capital stock per worker, k. suppose that, at time t, the number of workers doubles (say, due to an influx of immigrants). the number of workers is expected to remain forever thereafter constant at this new higher level, ie. n n. graphically analyze how this will impact the steady state capital stock per worker and the dynamics starting from initial capital stock an (b) draw diagrams plotting out how capital, output, and the real wage ought to respond dynamically to the permanent increase in the workforce.

An instance where sellers should work to keep relationships with customers is when they instance where selllars should work to keep relationships with customers is when they feel that the product

Suppose that two firms produce differentiated products and compete in prices. as in class, the two firms are located at two ends of a line one mile apart. consumers are evenly distributed along the line. the firms have identical marginal cost, $60. firm b produces a product with value $110 to consumers.firm a (located at 0 on the unit line) produces a higher quality product with value $120 to consumers. the cost of travel are directly related to the distance a consumer travels to purchase a good. if a consumerhas to travel a mile to purchase a good, the incur a cost of $20. if they have to travel x fraction of a mile, they incur a cost of $20x. (a) write down the expressions for how much a consumer at location d would value the products sold by firms a and b, if they set prices p_{a} and p_{b} ? (b) based on your expressions in (a), how much will be demanded from each firm if prices p_{a} and p_{b} are set? (c) what are the nash equilibrium prices?

Dan wants to start a supermarket in his hometown, and wants to get into the business only after finding out about the market and how successful his business might be. the best way for dan to gain knowledge is to: