In the long run, the growth rate of output per worker is determined by the: the saving rate only the growth rate of technology and the growth rate of population the growth rate of technology, the growth rate of population and the saving rate
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- Say that the average worker in the U.S. economy is eight times as productive as an average worker in Mexico. If the productivity of U.S. workers grows at 2 for 25 years and the productivity of Mexicos workers grows at 6 for 25 years, which country will have higher worker productivity at that point?Per capita GDP in the long run: Suppose an economy begins in steady state.By what proportion does per capita GDP change in the long run in responseto each of the following changes?(a) Te investment rate doubles.(b) Te depreciation rate falls by 10%.(c) Te productivity level rises by 10%.(d) An earthquake destroys 75% of the capital stock.(e) A more generous immigration policy leads the population to double.The aggregate production function is y=3KL. If they are 30 units of capital and 40 units of labor, what is aggregate output? What is labor productivity? What is capital productivity?
- A small economy increased its capital per hour worked (K/L) from $40,000 to $50,000. As a result, real GDP per worker (Y/L) grew from $20,000 to $25,000. If the economy increases its capital per hour worked by another $10,000 to $60,000, but there is no change in technology, by how much more and in what direction will output per worker change? Answer neatly with proper explanation of itGive typing answer with explanation and conclusion The production function is given by Y=AK, where K is the capital stock and A denotes the level of technology and equals 1.2 (the rate of technological progress equals 0). The rate of population growth is 2% and people save 15% of their incomes. The capital stock is 12000 and consumption of fixed capital is equal to 120 (and it always represents this percentage of the capital stock). Calculate the rate of growth of output per worker.In Wonderland production per worker (y) depends on capital per worker (3) such the y=10√k. Every year 15% of the capital stock depreciates, while workers in Wonderland save 10% of their income. Every year the population grows at as e of 3% a) How might Wonderland and Neverland achieve economic growth in the long run?
- Draw LRAS. What does LRAS stand for? On the same graph show economic growth qClassify each of the following as a movement along or a shift of the production function and provide a justification for your choice. (1)An increase in the number of machines used in production (2) An increase in the population growth rate (3) A new technological innovationPlease no written by hand and graph Consider a small world that consists of two different countries, a developed and a developing country. In both countries, assume that the production function takes the following form: Y = F (K, LE) = K¹/4 (LE) 3/4, where Y is output, K is capital stock, L is total employment and E is labour augmenting technology. (a) Does this production function exhibit constant returns to scale in K and L? Explain. (b) Express the above production function in its intensive form (i.e., output per-effective worker y as a function of capital per effective worker k). (c) Solve for the steady-state value of y as a function of saving rate s, population growth rate n, technological progress g, and capital depreciation rate 6. (d) The developed country has a savings rate of 30% and a population growth rate of 2% per year. Meanwhile, the developing country has a savings rate of 15% and population growth rate of 5% a year. Technology evolves at the rate of 8% and 2% in…
- One of the classic theories of economic growth is Rostow’s Stages of economic growth. Use the article, The Stages of Economic Growth to summarise the four stages outlined by Rostow and how they develop on each other.Country Has Cobb-Douglas production function: Y(it) = A(it) x K(it)1/3L(it)2/3 Where: Y(it) = realGDP K(it) = Capital L(it) = No. workers employed in country (i) on date (t) Suppose multiple countries share the same alpha = 1/3 but different levels of totalfactorproductivity (A(it)). How would one calculate the average annual growth rate of totalfactorprodctivity of each countryFor this question assume that technological progress does not occur. The rate of saving in Canada has generally been greater than the saving rate in the U.S. Given this information, we know that in the long run A) Canada's growth rate will be greater than the U.S. growth rate. B) capital per worker in Canada will be no different than U.S. capital per worker. C) investment per worker in Canada will be no different than U.S. investment per worker. D) all of these E) none of these