DSE 2011 Q 56

[Khagesh]

Hey temme how to solve Q56 i.e. find Rate of Growth of aggregate output in steady state for Solow Model?????????

[sunny2009]

......... Y=20(K)^0.5*(L)^0.5
       DIVIDING BY L BOTH SIDES
        Y/L=20(K/L)^0.5
      OR y = 20(k)^0.5
      or  f(k)= 20 (k)^0.5

in steady state,
sf(k)-nk equals 0.
or,sf(k)=nk (equation 1)

it is given that n=1/10 AND s=1/4
PUTTING THE VALUES...in the above equation
1/4*20(K)^0.5 = 1/10*K
U WILL SOLVE N GET THE VALUE OF K AS 2500.

[Khagesh]

I need for Q 56...

[sunny2009]

for ques 56.......
rate of growth of aggregate output in the steady state is equal to the rate at which the labour force grows...
hence the answer will be 1/10

[Khagesh]

thnx man :)

dre r oder doubts ive posted too.... plz c if u can solve dem too

[sunny2009]

welcome buddy :)
i will try my best to solve them...........