Macroeconomics
10th Edition
ISBN: 9781319105990
Author: Mankiw, N. Gregory.
Publisher: Worth Publishers,
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Question
Chapter 9, Problem 3QQ
To determine
The net marginal product of capital.
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Assume a Cobb-Douglas production with capital share 1/3; total factor productivity equal to 2, total population in an economy is equal to 1, the steady-state level of capital stock is 8.0. Then the steady-state level of output is about:
a.
4.0
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22.6
d.
8.0
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45.4
Assume a Cobb-Douglas production with capital share 1/3; total factor productivity equal to 1, total population in an economy is equal to 1, depreciation rate is 5 percent and saving rate is 10 percent. Then the steady-state level of capital is about:
a. 0.3
b. 0.8
c. 2.8
d. 1.6
e. 1.3
Explain why the cycle of productive capital represents the constant renewal of capital-value, as opposed to the cycle of money-capital.
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