Using the model for a closed economy, if the nominal wage is $40 and we have a Cobb-Douglas production function where a = 0.2, L = 400, and labor income + capital income = $2,000, what is the price of the output given the neoclassical theory of distribution holds? %3!
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- Consider a simple model where workers can be either employed or unemployed. Suppose the labour force is L= 100 million workers, the job separation rate is 2% per month and the job finding rate is 38% per month. Which of the following is true? A. In steady state, 5 million workers are unemployed B. All of the other options C. In steady state, 38 million workers are employed D. In steady state, there are more workers losing their jobs than there are unemployed workers finding a jobSuppose that output is produced according to the production function Y = Kα[(1 - u)L]1-α, where K is capital, L is the labor force, and u is the natural rate of unemployment. The national saving rate is s, the labor force grows at rate n, and capital depreciates at rate d. Express output per worker (y = Y/L) as a function of capital per worker (k = K/L) and the natural rate of unemployment (u). Write an equation that describes the steady state of this Find the steady state capital per worker and steady state output per worker. Does this production function have constant returns to scale?Consider a simple model where workers can be either employed or unemployed. Suppose the labour force is L = 300 million workers, the job separation rate is 4% per month and the job finding rate is 36% per month. Which of the following is true?Group of answer choices In steady state, fewer workers are losing their jobs than there are unemployed workers finding a job In steady state, 108 million workers are employed None of the other options In steady state, 12 million workers are unemployed
- Suppose that output is produced according to the production function Y = Kα[(1 - u)L]1-α, whereK is capital, L is the labor force, and u is the natural rate of unemployment. The national savingrate is s, the labor force grows at rate n, and capital depreciates at rate d.a. Express output per worker (y = Y/L) as a function of capital per worker (k = K/L) and thenatural rate of unemployment (u).b. Write an equation that describes the steady state of this economy. Find the steady state capitalper worker and steady state output per worker.c. Does this production function have constant returns to scale? Explain.Suppose that output is given by the neoclassical production function Y (t) = F (K(t), L(t), A(t)) satisfying Assumptions 1 and 2, and that we observe output, capital, and labor at two dates t and t + T . Suppose that we estimate TFP growth between these two dates using the equation Where g(t, t + T ) denotes output growth between dates t and t + T , and other growth terms are defined similarly, while αK(t) and αL(t) denote the factor shares at the beginning date. Let x(t, t + T ) be the true TFP growth between these two dates. Show that there exist functions F such that x(t, t ˆ + T )/x(t, t + T ) can be arbitrarily large or small. Next show the same result when the TFP estimate is constructed using the end-date factor shares: Explain the importance of differences in factor proportions (capital-labor ratio) between the beginning and end dates in these results.Analyse how a Neoclassical version of the labour market would indicate that, in equilibrium, all unemployment is voluntary, and how, assuming imperfect competition instead, would account for the existence of some involuntary unemployment.
- A key difference between the original Keynesian and New Keynesian approaches to the labour market , is that in the original model , nominal or money wages , are while in the New model , nominal wages areWhat are the assumptions of the classical theory of employment in the economyConsider a simple model where workers can be either employed or unemployed. If the job separation rate is s = 0.025 per month and the job finding rate is f = 0.475 per month, the steady state unemployment rate and expected duration of an employment spell are, respectively: 5% and 2.1 months 0.05% and 2.1 months 5% and 3.33 years 5% and 3.33 months
- Neoclassical Production Function Please write the logarithmic form of this production function, Log Y being the average GDP growth in the period considered, and compute Log A (contribution of TFP to GDP growth) assuming that in a given period according to national account statistics the average GDP growth (Log Y) and labor growth (Log L) have been respectively 5% and 2% while the capital stock growth (Log K) has been estimated at 6% and alpha at 0.4.Suppose that output is produced according to the production function Y =Kα[(1 - u)L]1-α, where K is capital, L is the labor force, and u is the natural rate of unemployment. The national saving rate is s, the labor force grows at rate n, and capital depreciates at rate d. Express output per worker (y = Y/L) as a function of capital per worker (k = K/L) and the natural rate of unemployment (u). Write an equation that describes the steady-state of this economy. Find the steady-state capital per worker and steady-state output per worker. Does this production function have constant returns to scale? Explain.Suppose that output is produced according to the production function Y =Kα[(1 - u)L]1-α, where K is capital, L is the labor force, and u is the natural rate of unemployment. The national saving rate is s, the labor force grows at rate n, and capital depreciates at rate d. Express output per worker (y = Y/L) as a function of capital per worker (k = K/L) and the natural rate of unemployment (u). Write an equation that describes the steady state of this economy. Find the steady state capital per worker and steady state output per worker. Does this production function have constant returns to scale? Explain.