Assume a Production Function Is Given By $Y = \bar { A } K _ { t } ^ { 1 / 3 } \bar { L } ^ { 2 / 3 }$

question 86

Multiple Choice

Assume a production function is given by $Y = \bar { A } K _ { t } ^ { 1 / 3 } \bar { L } ^ { 2 / 3 }$ . If $\bar { A } = \bar { L } = 1$
, the depreciation rate is $\bar { d } = 0.05$
, and the saving rate is $\bar { s } = 0.1 ,$
The steady-state level of capital is about:

• A) 0.3
• B) 1.3
• C) 2.8
• D) 0.8
• E) 1.6

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