Suppose that the production function is Y = 10 (K)1/4 (L)3/4 and capital lasts for an average of 50 years. Assume that the rate of growth of population equals 0 and saving rate s=0.128.
a. Calculate the steady-state level of capital per worker, output per worker, consumption per worker, saving and investment per worker, and depreciation per worker
b. Suppose that initial level of capital per worker is 100, explain the moving process to the steady state. c. Use relevant graph to demonstrate.