QUESTION
Suppose that a firm begins at time 𝑡 = 0 with a capital stock of 𝐾(0) = 500,000 pesos and, in addition to replacing any depreciated capital, is planning to invest in new capital at the rate 𝐼(𝑡) = 600𝑡^2 over the next ten years.
a. What is the planned level of capital stock at the end of 10 years?
b. How much net investment was made between the 3rd and 5th year?
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