Macroeconomics
10th Edition
ISBN: 9780134896441
Author: ABEL, Andrew B., BERNANKE, Ben, CROUSHORE, Dean Darrell
Publisher: PEARSON
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Question
Chapter 6, Problem 1AP
a.
To determine
To describe: Impact on consumption of a worker, if destruction of portion of the nation’s capital stock in a war.
b.
To determine
To describe:
Impact on consumption of a worker, if permanent increase in the rate of immigration.
c.
To determine
To describe: Impact on consumption of a worker, if permanent increase in energy prices.
d.
To determine
To describe: Impact on consumption of a worker, if there is temporary rise in the saving rate.
e.
To determine
To describe: Impact on consumption of a worker, if there is permanent increase in the labor force.
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Which of the following is an incorrect statement about the variable ‘s’ in the Solow Growth Model?
a.s is the fraction of income that is saved
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In the Solow model, population growth leads to steadystate growth in total output, but not in output per worker. Do you think this would still be true if the production function exhibited increasin g or decreasing returns to scale? Explain.
The amount of education the typical person receives varies substantially among countries. Suppose you were to compare a country with a highly educated labor force and a country with a less educated labor force.Assume that education affects only the level of the efficiency of labor. Also assume that the countries are otherwise the same: they have the same saving rate, the same depreciation rate, the same population growthrate, and the same rate of technological progress. Both countries are described by the Solow model and are in their steady states. What would you predict for the following variables?
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