Writing assignment must be typed (1.5 spacing, Times New Roman, 12pt font). As a guideline, essay response to the questions posed below should be about 3 pages in length. Read Chapter 2, “Aid for Investment.” From Easterly W., The Elusive Quest for Growth. MIT Press, 2001. Referring to evidence from the chapter, answer the following questions:1.Evaluate the following claim: “Savings is not enough for the investment needs of developing countries. As such, if aid agencies and rich countries provide aid to developing countries it will increase their rate of investment and generate economic growth.” Has such a strategy worked, why or why not?2.How is the Harrod-Domar model different from the Solow model we described in class? What role did Rostow’s ideas play for the provision of foreign aid?3.What conclusions would we draw about the impact of foreign aid on economic growth and development if we were to use the Solow model to analyze this question? Please use a diagram to supplement your answer. Grading of this assignment will be done based on the following:Identifying the issue(s): Clearly identifying the problem(s), question(s) or issue(s). Providing background for the problem(s), questions(s) or issue(s).Analytics: Applying economic concepts to the questions. Developing logical arguments. Drawing substantiated conclusions. Drawing connections between economic concepts and real-world applications.Communication and Structural Organization: Language clearly and effectively communicates ideas. Assignment is organized with an introduction, body, discussion, conclusions and referencesection, if applicable. Grammar, syntax and appropriate style.

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