In Chapter 7 we have described the optimal solution of the model in the same way as done in most publications on dynamics of the firm. Still, a lot of worthwhile economic analysis remains to be done. We present two more ways of analysis in this chapter. The first way of analysis is a derivation of global decision rules, which together constitute the policy of the firm. The stepping stones in the four master trajectories of Chapter 6 are the Q*-values, of which several are present in more than one trajectory. In Chapter 6 we have discussed the factors influencing these Q*-values, based on the three aspects of the policy of the firm in the relevant model concerning production, finance and investment/dividend.
KeywordsInterest Rate Wage Rate Output Level Optimal Trajectory Capital Good
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