For a closed economy: and , where , and are savings, income and investment in period , and and are positive constants. For , and , the value of is ________ (in integer).
For a closed economy: and , where , and are savings, income and investment in period , and and are positive constants. For , and , the value of is ________ (in integer).
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For a closed economy: Sₜ=aYₜ and Iₜ=g(Yₜ-Yₜ₋₁), where Sₜ, Yₜ and Iₜ are savings, income and investment in period t, and a and g are positive constants. For Y₀=100, a=0.5 and g=0.6, the value of Y₂ is (*in integer*).
Also written as: For a closed economy: S_t=aY_t and I_t=g(Y_t-Y_(t-1)), where S_t, Y_t and I_t are savings, income and investment in period t, and a and g are positive constants. For Y_0=100, a=0.5 and g=0.6, the value of Y_2 is (*in integer*).
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This question is on The Harrod-Domar model, part of Harrod–Domar and Solow growth models in Economics of Growth and Development.
Growth driven by saving and the capital-output ratio, and why it is knife-edge.
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