Assume an Endogenous Growth Model with Labor Augmenting Technology

question 31

Multiple Choice

Assume an endogenous growth model with labor augmenting technology.The production function is Y = F(K,AN) with A = 2(K/N) , so y = 2k.If the savings rate is s = 0.05 and there is neither population growth nor depreciation of capital, what is the growth rate of output?

• A)0%
• B)2)5%
• C)5%
• D)10%
• E)it cannot be determined

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