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Questions › CUET-PG › CUET-PG 2023 Shift 2 › Q52
4 marks, −1Economics of Growth and Development › Harrod–Domar and Solow growth models › The golden ruleHardabout 2 min

CUET-PG 2023 Shift 2 Question 52: Harrod–Domar and Solow growth models

For the per capita production function y=k0.5y = k^{0.5}y=k0.5; what is the level of savings rate at which the consumption per capita is maximised at steady state? Assume depreciation (δ)=0.1(\delta) = 0.1(δ)=0.1 and no population growth.

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For the per capita production function y = k⁰·⁵; what is the level of savings rate at which the consumption per capita is maximised at steady state? Assume depreciation (δ) = 0.1 and no population growth. (A) 10% (B) 20% (C) 40% (D) 50%

Also written as: For the per capita production function y = k^(0.5); what is the level of savings rate at which the consumption per capita is maximised at steady state? Assume depreciation (delta) = 0.1 and no population growth.

Harrod–Domar and Solow growth models has come up 113 times in 7 exams since 2006.

What this question tests

This question is on The golden rule, part of Harrod–Domar and Solow growth models in Economics of Growth and Development.

The saving rate that maximises consumption per worker in the steady state.

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Take this paper as a timed mockMore on The golden rule

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Question from the CUET-PG 2023 Shift 2 paper. Solutions are TestStop's own. Not affiliated with or endorsed by any examination authority.