Consider an economy at the steady state of the Solow growth model. (a) Many machines in use in industry are expected to have a useful life of 10 to 30 years before needing to be replaced. Computers have a useful life more like 3 to 5 years before they need to be replaced. What does this imply about the depreciation rate of computers relative to other forms of capital? (b) As computers become a larger component of capital spending, how will this affect the Steady State of the economy? Draw a graph that captures the impact of the new depreciation rate on the economy. Place subscript 1 on all steady state variables associated with the old Steady State. Place a subscript 2 on all steady state variables associated with the new Steady State. Be sure to label which cures appropriately as well. (c) What happens to the "golden rule" level of capital when the depreciation rate changes? Support your answer (you may use a graph if it is useful). (d) Based on your analysis in (4b), would you say that the increased use of computers in business is good for the economy? Explain your answer. If it is important to your answer, assume that k₁* < kg. (Note: if k₁* < kg, then it is also true that k₂* < kg. We did not cover this in class.) (e) An alternate view of the impact of computers would recognize that each new computer is a technological improvement over the older computer it is replacing (offering greater processing speed, more memory, etc.). Graphically show on a new graph the impact of purchases of new computers on the Steady State based on this alternate view computers. (f) Use the figure developed in class to demonstrate the progress of k, y, i, and c over time as the economy transitions from the old Steady State to the new (based on (4e)). Please make it clear if there is a jump in a variable.