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Consider the following Malthusian model where Y=zL1/2N1/2 and z=1. N is population and L is the...

Consider the following Malthusian model where Y=zL1/2N1/2 and z=1. N is population and L is the total land area. L is fixed.

For the periods from 0 to T-1 the economy was at the steady state. However, at the beginning of time T, there was a sudden drop in z and stayed at the new, lower value for all the future periods.


Plot the time path for each of the following three variables: c, N and Y.
(Plot them on a single sheet using three seperate diagrams)

Note: Time path for a variable is the evolution of the variable as a function of time, where time is on the horizantal axis.

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