3. What is an aggregate production function? A change in what factor or factorscause a movement along the aggregate production function? A change in whatfactor or factors shifts the aggregate production function?

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

Answered: What is an aggregate production…

Principles of Economics 2e

2nd Edition

ISBN:9781947172364

Author:Steven A. Greenlaw; David Shapiro

Publisher:Steven A. Greenlaw; David Shapiro

Chapter20: Economic Growth

Section: Chapter Questions

Problem 29CTQ: How is the concept of technology, as defined with the aggregate production function, different from...

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What is an aggregate production function?
For a high-income economy like the United States, what aggregate production function elements are most important in bringing about growth in GDP per capita? What about a middle-income country such as Brazil? A low-income country such as Niger?
5) Refer to Table 22.3.1. above. The tables show the labour market and the aggregate production function schedules for the country of Pickett. a) Plot (create a graph) of both the aggregate labour market and aggregate production function. Using these graphs, what is theequilibrium real wage and quantity of labour? What is the level of real GDP? b) At the equilibrium in the labour market, what is the amount of labour productivity associated with that equilibrium? (Show your calculations) c) If the quantity of labour supplied increases by 20 billion hours at every real wage level, what would be the new level of labour productivity? (Show your calculations) d) If only the quantity of labour supplied is increasing over time, what is the impact on the production function and the level growth rate of real GDP per hour over time? Fully explain your answer.
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.
#37 Which of the following is not a determinant of the long-run level of real GDP? a The amount of capital used by firms b The price level c Available technology d Available stock of human capital
Assume an economy where there are two producers: a wheat producer and a bread producer. In agiven year, the wheat producer grows 3 million tonnes of wheat, of which 2.5 million tonnes aresold to the bread producer at $30 per bushel, and 0.5 million tonnes are stored by the wheatproducer to use as seed for next years crop. The bread producer produces and sells 100 millionloaves of bread to consumers for $3.50 per loaf. Determine GDP in this economy during this yearusing the product and expenditure approaches.
4. A measure of the degree to which capital wears out or becomes obsolete during a period is: A) rent. B) production costs. C) deferred expenditure. D) depreciation. 5. Which of the following would not be included in the measurement of GDP? A) federal government payments for Jeeps B) a purchase of California wine by a Canadian firm C) employers' payments for employees' medical insurance D) transactions in the underground economy 6. Aggregate demand is the total value of real GDP that A) all sectors of the economy are willing to purchase at various average price levels, all other things unchanged. B) all sectors of the economy are willing to sell at various average price levels, all other things unchanged. C) consumers are willing to purchase at various average price levels, all other things unchanged. D) consumers are willing to purchase…
Assume that we have a Cobb-Douglas type aggregate production function in the form: Y = Ka.Lb c. Briefly explain why y'>0 or dy/dk > 0 . Is it possible that dy/dk < 0 ? Why? d. Briefly explain why y'' ≤ 0 . e. Find the elasticity of substitution between K and L. What does expansion path look like?
c. You are given the following information about an economy. Y = C + I Y = F(K, L) The aggregate production function for this economy exhibits constant returns to scale and the marginal products of labor and capital are both subject to diminishing returns. s = saving rate (assume this is constant) per year δ= depreciation rate (assume this is a constant) per year y = Y/L k = K/L k* = steady state of capital per worker (K/L) and sf(k) < δk. i. What is sf(k) ii. What is δk? iii. Interpret the meaning of sf(k) < δk?
4. How is GDP per capita calculated differently from labor productivity? 5. How do gains in labor productivity lead to gains in GDP per capita? 6. What is an aggregate production function?
Real GDP in 2015 was SAR 12,247 billion. It was SAR13,206 billion in 2018. The population of Saudi Arabia increased from 22.9 million to 25.4 million over this time. a. Determine the actual GDP per person for 2015 and 2018. How much did output per individual increase throughout this time, on average? b. What would real GDP have been in 2018 if real GDP had increased by 3% year from -2015 to 2018?
Draw an example production function in terms of output and capital.GIVE 2 specific properties which define its shape; explain these usingthe definition and properties of MPK.

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What is an aggregate production function? A change in what factor or factors cause a movement along the aggregate production function? A change in what factor or factors shifts the aggregate production function?