Consider a version of the Romer model with the following production function: Y; = AQ5 Lyt In this version of the model the exponent on ideas in the output production function has been reduced so that...

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Extracted text: Consider a version of the Romer model with the following production function: Y; = AQ5 Lyt In this version of the model the exponent on ideas in the output production function has been reduced so that ideas have diminishing returns in the production of output. Provide an economic interpretation of this re-formulation of the problem. a. What is the growth rate of knowledge in this economy? b. c. What is the growth rate of output per person in this economy? d. Solve for the level of output per person at each point in time.