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Assignment:
1. Using the Harrod-Domar model to prove that the sum of the population growth rate (n) and productivity improvement (p) is smaller than the ratio of the saving (s) and capital-output rates (c).
Hint: Using the mathematical notation of each variable to explain the economic relationships among each defined variable.
2. The economic growth (g) is around 5.9% in China, and please calculate the corresponding saving rate (s) using the results from the previous question.
Note that the depreciation rate (d) is 0.03, and the capital-output rate (c) is 3.
3. In the absence of such a savings rate, list at least two possible policies to raise the savings.
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