Capital formation is the process of adding to a given stock of capital. Regarding this process as continuous over time, we may express capital formation as a function of time, C(t), and use the derivative dC/dt to denote the rate of capital formation. The rate of capital formation at time t is identical with the rate of net investment flow at time t, denoted by I(t). Thus, capital stock C and net investment / are related by: dC (1) = 1(t) dt Identity (1) shows the synonymity between net investment and the increment of capital. Suppose that 1(t) = 6 x √√6t+0.06 and that the initial stock of capital at time zero is C(0)=36. Use Identity (1) to set up and solve an indefinite integral in order to determine the capital formation function C(t) for the given l(t).

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