Ramsay function states that K will br higher if capital is less productive and lower if consumers are impatient .
As per Ramsay function in steady state growth the fall in Technological progress results in lower value of K.
The situation can be plotted on graph
6. (Romer 2006, page 93 Q 2.6) Productivity slowdown. Consider a Ramsey-Cass-Koopmans economy that is on...
6. Romer 2006, page 93 Q 2.6) Productivity slowdown. Consider a Ramsey-Cass-Koopmans economy that is on its balanced growth path (i.e. steady state) and suppose that there is a permanent fall in g (technological progress rate) b. How, if at , does this affect the c 0 curve? c-C/L C is consumption and L is Labor therefore c is consumption per labor in present, C is consumption per labor in future. 6. (Romer 2006, page 93 Q 2.6) Productivity slowdown....
6. (Romer 2006, page 93 Q 2.6) Productivity slowdown. Consider a Ramsey-Cass-Koopmans economy that is on its balanced growth path (i.e. steady state) and suppose that there is a permanent fall in g (technological progress rate) th (ie steady state) and b. How, if at all, does this affect the 0 curve?
5. Stoe-Geary preferences and Ramsey economy] Consider the standard Ramsey model of a closed economy, except that the representative house- hold's instantaneous utility function (felicity function) takes on the following Stone-Geary form, so that preferences are no n-homothetic u(c) 1-6 where č0 represents the subsistence level of per capita consumption. Suppose that the production function has the Cobb-Douglas form, and assume that there's no technological progress e. Does the modification of the felicity function affect the steady-state values of k...
How do the national income accounts change if social security payments increase? A) Consumption falls. B) Consumption rises. C) Savings rise. D) This change is not captured in the national income accounts. How do the national income accounts change if unemployment benefits paid to people increase? A) Consumption falls. B) Consumption rises. C) Savings rise. D) This change is not captured in the national income accounts. How do the national income accounts change if national defense spending increases? A) Government...
1.Suppose an economy experiences a 4% increase in each of the following variables: N, K, and H (human capital). If the production function is Y=KαN(1-α)Hβ, where α<1 and β<1, we know with certainty that Y will increase by less than 4%. none of the other answers is correct Y will increase by less than 12% but by more than 4%. Y will increase by exactly 4%. Y will increase by more than 4%. 2. Why do banks maintain a certain...