# Golden rule steady state capital

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the steady state the marginal product of capital equals 0.10, the depreciation rate equals 0.05, and the rate of population growth equals 0.03, then the capital per worker ratio ____ the Golden Rule level.

The golden-rule level is the steady state of capital which maximizes consumption. Since policy makers are concerned with the economic wellbeing of the people then naturally they would choose the ... The "golden rule" is the level at which steady-state consumption is at a maximum, given the parameters of the model. Steady state consumption is $$c^* = (1-s^*)\cdot f[k^*(s^*)] = f[k^*(s^*)] - s^*f[k^*(s^*)] \tag{1}$$ where $0<s^*<1$ We also have that, at the steady state (for constant capital) $$s^*f[k^*(s^*)] = \delta k^*(s^*) \tag{2}$$ Hp envy 15 k004tx specification sheets

Question: Suppose An Economy Is Initially In A Steady State With Capital Per Worker Below The Golden Rule Level. If The Saving Rate Increases To A Rate Consistent With The Golden Rule, Then In The Transition To The New Steady State Consumption Per Worker Will: A. Always Exceed The Initial Level. In economics, the Golden Rule savings rate is the rate of savings which maximizes steady state level or growth of consumption, as for example in the Solow growth model. Although the concept can be found earlier in John von Neumann and Maurice Allais's works, the term is generally attributed to Edmund Phelps who wrote in 1961 that the golden rule "do unto others as you would have them do unto you" could be applied inter-generationally inside the model to arrive at some form of "optimum", or put s