CourseWork

Not Rated (0)

$15/per page/

About CourseWork

Levels Tought:
Elementary,Middle School,High School,College,University,PHD

Expertise:
Applied Sciences,Chemistry See all
Applied Sciences,Chemistry,Communications,Economics,Engineering,Environmental science Hide all
Teaching Since: Apr 2017
Last Sign in: 363 Weeks Ago, 5 Days Ago
Questions Answered: 352
Tutorials Posted: 351

Education

  • MBA,PHD in Psychology
    Northwest Florida State College
    Jun-1992 - May-1997

Experience

  • Professor
    Northwest Florida State College,
    Aug-2006 - Nov-2015

Category > Economics Posted 03 May 2017 My Price 9.00

Stone–Geary preferences.

Stone–Geary preferences. Assume that the usual conditions of the Ramsey model hold, except that the representative household’s instantaneous utility function is modified from equation (2.10) to the Stone–Geary form: u(c) = (c − ¯ c)1−θ – 11 – θ where ¯ c ≥ 0 represents the subsistence level of per capita consumption.

a. What is the intertemporal elasticity of substitution for the new form of the utility function?

If ¯ c > 0, how does the elasticity change as c rises?

b. How does the revised formulation for utility alter the expression for consumption growth in equation (2.9)? Provide some intuition on the new result.

c. How does the modification of utility affect the steady-state values ˆk∗ and ˆ c∗?

d. What kinds of changes are likely to arise for the transitional dynamics of ˆk and ˆ c and, hence, for the rate of convergence? (This revised system requires numerical methods to generate exact results.)

 

 

Answers

CourseWork
Not Rated (0)
Status NEW Posted 03 May 2017 12:05 PM My Price 9.00

Hel-----------lo -----------Sir-----------/Ma-----------dam-----------Tha-----------nk -----------You----------- fo-----------r u-----------sin-----------g S-----------obt-----------ell----------- an-----------d a-----------cqu-----------isi-----------tio-----------n o-----------f m-----------y p-----------ost-----------ed -----------sol-----------uti-----------on.----------- Pl-----------eas-----------e p-----------ing----------- me----------- on----------- ch-----------at -----------I a-----------m o-----------nli-----------ne -----------or -----------inb-----------ox -----------me -----------a m-----------ess-----------age----------- I -----------wil-----------l b-----------e c-----------atc-----------h

Not Rated(0)