Mistake in Lucas-Asset-Pricing-Model

[llorracc]

Mateo,

I'm confused -- maybe somehow I screwed up the merge process, but as I was making some minor edits to the notebook I noticed that the derivations in the case where dividends are a geometric random walk with drift are wrong.

The right formulas are in the edits you made to the LucasAssetPrice notebook.

The formulas in the notebook end up with a constant ratio of P to $d^{\rho}$ which can't be right because the model is homothetic. Then there is a comparison of the numerical to the analytical solution, showing a nonlinear relationship between price and dividend. Again, that can't be (whether it's solved analytically or numerically).

Could you fix it to be consistent with the lecture notes?