Answered: Suppose the economy's production…

Suppose the economy's production function is Y=AK0.3N0.7. If K = 2000, N = 100. Calculate the output level of the economy.

Economics (MindTap Course List)

13th Edition

ISBN:9781337617383

Author:Roger A. Arnold

Publisher:Roger A. Arnold

Chapter17: Economic Growth: Resources, Technology, Ideas And Institutions

Section: Chapter Questions

Problem 5WNG

See similar textbooks

Related questions

Q: Q2) The production function of a small economy is Y=K0.3L°7. K is the amount of capital (land), L is…

A: (a) Production function Y = K0.3 L0.7 Where K is land and L is labor ----------------------------…

Q: d) If the quantity of labor supplied increases by 1%, what is the increase in the firm's output?…

A: Answer d) If the Quantity of Labour supplied Increased by 1% then, the firm's output shown as…

Q: The below five graphs show the development of key macroeconomic variables over the scope of three…

A: The IS-LM-PC is defined as a model which is known as the Income Spending, Monetary Policy and the…

Q: Suppose a country has a production function Y=2K0.5L0.5, where K is the amount of capital and L is…

A: As per given information given in question; The Cobb Douglas Production FUnction is given below ;…

Q: Give the equation for a linear consumption function?

A: According to the given question Simply we can say that a linear consumption function is an function…

Q: Economic activity fluctuates in the short-run. Why is this the case?

A: Short-run refers to the time period for which demand and supply last over the time horizon. During…

Q: Suppose that a hypothetical economy has the following relationship between its real domestic output…

A: Factors of production ,also called inputs , refer to resources needed for the development of final…

Q: Given the production function Y=A(K,L,N,H), what is the role of money in generating long run growth…

Q: Natural rate of output is equal to the amount of real GDP when the economy is at the: a) Natural…

A: Natural rate of output is related with natural rate of employment.

Q: Covid-19 has a huge impact on aggregate economic activities, please discuss this impact and explain…

A: The Covid-19 has led to the fall in the aggregate demand significantly. It has adversely impacted…

Q: State the relationship between the LAC curve and the LMC in economics!

A: According to the given question LMC curve stand for long run marginal cost curve is that type of the…

Q: You are given the following information on an imaginary economy of their adult population. Number of…

Q: Input Quanity 100 150 200 Real domestic output 200 300 400 The table gives information…

A: Per unit cost of production is the average cost of production. In the long run, a firm charges a…

Q: A technological improvement that increases the marginal product of capital will a. Shift the saving…

A: Investment demand curve shows the negative relationship between the dollar amount of investment at…

Q: Which of the following is an example of a final good or service? wheat a bakery purchases to make…

A: Computer purchased would be final good.

Q: Movement of Labor and Capital Between Countries In the short-run specific-factors model, consider a…

A: GIVEN Movement of Labor and Capital Between Countries In the short-run specific-factors model,…

Q: Which of the following is an example of economic investment? ABC Corporation buys an a run-down…

A: Economic investment are, by definition, increases to the capital load of an organization. These can…

Q: The production function shows the relationship between Oa potential and real GDP. Ob. inflation and…

A: The production function shows the relationship between physical inputs and output. The production…

Q: Calculate business investment for the following data: Y = 55,000 C = 40,000 G= 5,000 NX= - 2000…

A: Aggregate expenditure is the sum of consumption, investment, government spending, and net exports.…

Q: Suppose land increases by 20% and the number of employed workers increases by 25% in country A.…

A: To explain the long-run impact of the drivers of economic growth, Solow growth model shows the…

Q: “In the production process, it may be expected that a progressive increase in the input results in a…

A: Definition: A production process is a strategy for utilizing financial info or assets, similar to…

Q: », and is then hit by a sharp increase in

Q: In the "circular flow model" of a macro economy, the population is growing savings are large enough…

A: The circular flow of income shows how money flows between households and firms

Q: The country of Kemper is on its aggregate production function at point W in the above figure. If the…

A: Gross domestic product of a country is the market value of all final commodities and services that…

Q: A movement along the consumption function can be caused by a a. check from sold mutual funds. b.…

A: The consumption function describes the mathematical relationship between consumption and the…

Q: The aggregate change of consumption, Ċ(t) and the aggregate change of the capital stock, K(t), are…

A: A steady-state economy aims to achieve a balance between population and production growth. The…

Q: Which of the following curve(s) is drawn vertically on a GDP / Y / Production / employment graph?…

A: Curve- It is a graphical representation of demand, supply, etc.

Q: "In the 'Intermediate Run' an increase in the real interest rate leads to a reduction in Investment…

A: “Since you have asked multiple questions, we will solve the first question for you. If you want any…

Q: Suppose the production function in an economy is Y = K0SL0.5, where K is the amount of capital and L…

A: Y = K0.5L0.5K = 25L = 25

Q: Refer to the production possibilities schedule below assuming full employment.

A: Since the question you have posted consists of multiple parts, we will solve the first three parts…

Q: Suppose that the table presented below shows an economy's relationship between real output and the…

A: Input Quantity Real GDP 150 400 112.5 300 75 200

Q: Suppose that the table below shows an economy's relationship between real output and the inputs…

A: Given input and real output of the economy Productivity = Real output / inputs

Q: Which of the following is the most likely to occur in the Circular Flow Model when a recession takes…

A: Recession is a period of falling real GDP in the economy.

Q: The graph for the MPL has a negative slope but it's above the horizontal axis. This means that: a.…

A: MPL (Marginal productivity of labour): MPL refers to the increase in the total production when…

Q: When do we reach equilibrium output?

A: Demand can be defined as the quantity of a good that the customers are able and willing to buy at a…

Q: What is an aggregate production function? A change in what factor or factors cause a movement along…

A: Production is the process of merging numerous material and immaterial inputs (plans, know-how) to…

Q: What does a positive NPW mean?

A: We get NPW by the following expression,

Q: If the population of a country grows and increases both the labor force and the demand for…

A: GDP is the value of final goods and services produced in the economy within a given period of time.

Question

Suppose the economy's production function is Y=AK0.3N0.7. If K = 2000, N = 100. Calculate the output level of the economy.

Expert Solution

This question has been solved!

Explore an expertly crafted, step-by-step solution for a thorough understanding of key concepts.

This is a popular solution!

SEE SOLUTION Check out a sample Q&A here

Step 1

VIEW

Step 2

VIEW

Trending now

This is a popular solution!

Step by step

Solved in 2 steps

SEE SOLUTION Check out a sample Q&A here

Knowledge Booster

Learn more about

Need a deep-dive on the concept behind this application? Look no further. Learn more about this topic, economics and related others by exploring similar questions and additional content below.

Similar questions

Which is an example of the aggregate production function, Y = F(K, N), that exhibits constant returns to scale? Y= 2 K N Y = 3 K N Y = K/N Y= 2K + 3 N
Consider three inputs of production: labour, physical capital and natural resources, and an economy with decreasing returns to scale. If you increase all three inputs x times then the total gross domestic product (GDP) in the economy will increase exactly x times, but GDP per capita will decrease
Using the production function Real GDP = T (L, K), define the term production function and describe what each of the variables (T, L, and K) represents. When graphed with Real GDP on the vertical axis and labor on the horizontal axis, which variable(s) can shift the production function and which variable(s) can cause a movement along the production function?
Suppose you are given the aggregate production function for an economy and the amount of available technology increases for this economy. If labor and capital constant are held constant, increase in technology will causes labor productivity to decrease. True False
Refer to the figure above. The country of Kemper is on its aggregate production function at point W in the above figure. If the population increases with no change in capital or technology, what will happen to the economy? Explain your answer.
“An economy which does not have a strong manufacturing infrastructure cannot continue to make required investment on itself. An economy that grows only by service sector means that it is built on sand.” Sony Member and CEO Akia Morito 1992. Do you agree with Akia Morito’s idea?
Suppose a country has a production function Y=2K0.5L0.5, where K is the amount of capital and L is the amount of labor. The economy begins with 400 units of capital and 625 units of labor. Find numerical answers to the following. Be sure to show your work. What is the real wage and the real rental price of capital? (Hint: Assume the firms are maximizing profit.) Suppose there is a natural disaster and half of the capital is destroyed. What is the new level of output? What is the new real wage and real rental price of capital? How much output does the economy produce? Please answer all part I will rate
In macroeconomics, the connection from inputs to outputs for the entire economy is called _______________. Question options: a) physical capital b) a production function c) human capital d) an aggregate production function
Suppose a country has a population of 120 people, a working-age population of 100 people, its labor force participation rate is 0.5 (50%), and the quantity of output is 60 units. Suppose that the production function of the economy is given by Y=2N, where Y represents the quantity of output and N represents the number of workers needed to produce the output. I know the answer is 0.4 but I don't understand how to get it. Thank you!
Neoclassical Production Function Please write the production function in its simplest form (human capital being included in TFP) and explain the nature of each factor of production.
Refer to the graph shown below. At point A: Which is true? A: the economy has full employment B: economic growth is declining C: inflation tends to be declining D: wages can be lowered due to worker surplus
14. If output is described by the production function Y = AK0.2L0.8, then the production function has: Select one: A. Constant returns to scale and the share of labor in GDP is 0.2. B. increasing returns to scale and the share of labor in GDP is 0.2. C. Decreasing returns to scale and the share of labor in GDP is 0.8. D. constant returns to scale and the share of labor in GDP is 0.8.