EBK ECONOMICS: PRINCIPLES AND POLICY
13th Edition
ISBN: 8220100605932
Author: Blinder
Publisher: Cengage Learning US
expand_more
expand_more
format_list_bulleted
Question
Chapter 24, Problem 5DQ
To determine
The impact of change in investment in U.S.
Expert Solution & Answer
Trending nowThis is a popular solution!
Students have asked these similar questions
Q4. Suppose that Brazil initially has a higher capital rental rate (r) than the United States.
What would be the direction of foreign direct investment (FDI)?
Use a world-capital-market graph to show the effects of FDI on the two countries’ rental rates of capital, GDP, and return to labor owners.
Identify the net change in world output in the above graph.
Discussion: what other effects could FDI cause in the recipient and source countries that are not captured in the model?
Your answer
=
5√K and has a capital
Country A produces GDP according to the following equation: GDP
stock of 13,399. If the country devotes 13% of its GDP to producing or repairing investment goods,
how much is this country currently investing?
Rounds your answer to two decimal places.
With the following excerpts, how could economic growth affect the value of a country’s imports
Chapter 24 Solutions
EBK ECONOMICS: PRINCIPLES AND POLICY
Knowledge Booster
Similar questions
- Imagine two countries, i and j. You have the following information: si = 2 sj s= saving rate hi= hj h=human capital 2Ai = Aj A=technology What can you infer about long-run income per worker differences between these countries? Explain formally.arrow_forwardAssume that a country experiences a permanent increase in its saving rate. Which of the following will occur as a result of this increase in the saving rate?arrow_forwardWhat can you say about Turkey in the average GDP growth for the next 3 years (2021-2023)?arrow_forward
- China invests almost 50 percent of its annual production in new capital compared to 15 percent in the United States. Capital per hour of labor in China is about 25 percent of that in the United States. Explain which economy has the higher real GDP per hour of labor, the faster growth rate of labor productivity, and which experiences the more severe diminishing returns.arrow_forwardExplain the difference between foreign direct investment (FDI) and foreign portfolio investment (FPI)? Explain which one is more useful to accelerate economic growth of home country.arrow_forwardList the factors that account for increases or decreases in productivity growth rates.arrow_forward
- Discuss the factors affecting the GDP growth in Gulf corporation countries (GCC)?arrow_forwardMany countries import considerable amounts of goods and services from other countries. Yet economists argue that a nation can enjoy a high standard of living only if it can produce a large quantity of goods and services itself. Can you reconcile these two facts?arrow_forwardQ1. Suppose that Brazil initially has a higher capital rental rate (r) than the United States. a. What would be the direction of foreign direct investment (FDI)? b. Use a world-capital-market graph to show the effects of FDI on the two countries' rental rates of capital, GDP, and return to labor owners. c. Identify the net change in world output in the above graph. d. How would the wage rate and the rental rate of capital in the recipient country be affected in the long run? e. Discussion: what other effects could FDI cause in the recipient and source countries that are not captured in the model?arrow_forward
- Country A produces GDP according to the following equation: GDP = 5√K and has a capital stock of 12,254. If the country devotes 15% of its GDP to producing or repairing investment goods, how much is this country currently investing? Rounds your answer to two decimal places.arrow_forwardBriefly explain whether investment spending is likely to increase more rapidly in a country with a rapidly growing population or in a country with a slowly growing population. Does your answer depend on whether the country is a high-income industrial country or a low-income developing country?arrow_forwardWhen using AD/AS analysis to illustrate changes within an economy, which of the following would NOT need to be considered when looking at changes to economic growth? Select one: a. More efficient use of the capital stock b. Developing a more efficient capital and finance sector c. Increased labour productivity d. Increased availability of social capitalarrow_forward
arrow_back_ios
SEE MORE QUESTIONS
arrow_forward_ios
Recommended textbooks for you
- Macroeconomics: Private and Public Choice (MindTa...EconomicsISBN:9781305506756Author:James D. Gwartney, Richard L. Stroup, Russell S. Sobel, David A. MacphersonPublisher:Cengage LearningEconomics: Private and Public Choice (MindTap Cou...EconomicsISBN:9781305506725Author:James D. Gwartney, Richard L. Stroup, Russell S. Sobel, David A. MacphersonPublisher:Cengage LearningExploring EconomicsEconomicsISBN:9781544336329Author:Robert L. SextonPublisher:SAGE Publications, Inc
Macroeconomics: Private and Public Choice (MindTa...
Economics
ISBN:9781305506756
Author:James D. Gwartney, Richard L. Stroup, Russell S. Sobel, David A. Macpherson
Publisher:Cengage Learning
Economics: Private and Public Choice (MindTap Cou...
Economics
ISBN:9781305506725
Author:James D. Gwartney, Richard L. Stroup, Russell S. Sobel, David A. Macpherson
Publisher:Cengage Learning
Exploring Economics
Economics
ISBN:9781544336329
Author:Robert L. Sexton
Publisher:SAGE Publications, Inc