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Homework answers / question archive / The figure below shows the steady state in the Solow model with population growth (n): Output per worker, y Production function (d+n)k Investment Capital per worker, k a
The figure below shows the steady state in the Solow model with population growth (n): Output per worker, y Production function (d+n)k Investment Capital per worker, k a. Label the steady-state levels of k, y, and c (consumption per worker) as k*, y*, and c*. b. Consider two countries, Japan and Turkey. Japan's population grew at 0.4% per year in 2011, whereas Turkey' grew at 1.2% per year. Otherwise the two are identical. Assuming these population growth rates represent long-run values, how would k*, y*, and c* be different in Japan than in Turkey? How would their steady-state growth rates of output per worker differ?