Answer the following questions based on the given information Original K = $45 billion Original L = 12.5 million d = 6% L growth = 2.5% K= value of kapital; L = Labor force; d = Depreciation 1. What i

Answer the following questions based on the given information

Original K = $45 billion

Original L = 12.5 million

d = 6%

L growth = 2.5%

K= value of kapital; L = Labor force; d = Depreciation

1. What is the original K/L ratio?

2. After 1 year, given depreciation and the growth in the labor force, what is the new K/L ratio?

3. How much gross investment is necessary to bring the K/L ratio back to its original level?

            a. what % of the original level of Kapital is this gross investment?

            b. How much gross investment is necessary per unit of additional labor?

4. In order to achieve a target growth in the original K/L ratio of 4%, how much net investment is necessary?