Principles of Economics 2e
2nd Edition
ISBN: 9781947172364
Author: Steven A. Greenlaw; David Shapiro
Publisher: OpenStax
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Textbook Question
Chapter 20, Problem 29CTQ
How is the concept of technology, as defined with the aggregate production function, different from our everyday use of the word?
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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?
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.
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Why does adding capital to a production function make the economy more productive? What are diminishing returns to capital? How does technology affect productivity and growth?
Chapter 20 Solutions
Principles of Economics 2e
Ch. 20 - Explain what the Industrial Revolution was and...Ch. 20 - Explain the difference between property rights and...Ch. 20 - Are there other ways in which we can measure...Ch. 20 - Assume there are two countries: South Korea and...Ch. 20 - What do the growth accounting studies conclude are...Ch. 20 - What policies can the government of a free-market...Ch. 20 - List the areas where government policy can help...Ch. 20 - Use an example to explain why, after periods of...Ch. 20 - Would the following events usually lead to capital...Ch. 20 - What are the advantages of backwardness for...
Ch. 20 - Would you expect capital deepening to result in...Ch. 20 - Why dues productivity growth in high-income...Ch. 20 - How did the Industrial Revolution increase the...Ch. 20 - How much should a nation be concerned if its rate...Ch. 20 - How is GDP per capita calculated differently from...Ch. 20 - How do gains in labor productivity lead to gains...Ch. 20 - What is an aggregate production function?Ch. 20 - What is capital deepening?Ch. 20 - What do economists mean when they refer to...Ch. 20 - For a high-income economy like the United States,...Ch. 20 - List some arguments for and against the likelihood...Ch. 20 - Over the past 50 years, many countries have...Ch. 20 - Labor Productivity and Economic Growth outlined...Ch. 20 - Change in labor productivity is one of the most...Ch. 20 - Refer back to the Work It Out about Comparing the...Ch. 20 - Education seems to be important for human capital...Ch. 20 - Describe some of the political and social...Ch. 20 - Why is investing in girls education beneficial for...Ch. 20 - How is the concept of technology, as defined with...Ch. 20 - What sorts of policies can governments implement...Ch. 20 - As technological change makes us more sedentary...Ch. 20 - An economy starts off with a GDP per capita of...Ch. 20 - An economy starts off with a GDP per capital of...Ch. 20 - Say that the average worker in Canada has a...Ch. 20 - Say that the average worker in the U.S. economy is...
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Similar questions
- Why is a Cobb-Douglas production function useful for analyzing economic growth?arrow_forwardIf we have an aggregate production function of the form Y = AK, at what capital-labor ratio can a steady-state equilibrium be reached?arrow_forwardIf techology grows at a rate of 1% per period- how fast does output per worker grow in the long run or steady state if the production function is Y = A*(K^0.5) *(L^0.5)arrow_forward
- 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?arrow_forwardClassify 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 innovationarrow_forwardIn 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 functionarrow_forward
- Why does an increase in the labor force cause the Market Productivity of Capital to increase?arrow_forwardWhat is a significant factor in long-run economic growth that Robert Fogel, an economic historian, is best known for suggesting?arrow_forwardFor a high-income economy like Australia, what aggregate production function elements are most important in bringing about growth in GDP per capita? What about a middleincome country such as India? A low-income country such as Afghanistan?arrow_forward
- Give 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.arrow_forwardLong-run economic growth can occur as a result ofarrow_forward
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