# 7. Assume that the rate of growth of population equals 0. Suppose that there is a...

###### Question:

7. Assume that the rate of growth of population equals 0. Suppose that there is a sudden increase in the rate at which capital depreciates. The production function remains unchanged.

a. On a graph, illustrate the effects of this change on the steady-state level of capital per worker if the saving rate remains unchanged.

b. Describe the effect of this change on the Golden Rule level of capital per worker, and explain your answer

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