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Consider a closed economy in which the population grows at the rate of 2% per year....
3) Consider a closed economy in which the population grows at the rate of 1% per...
3) Consider a closed economy in which the population grows at the rate of 1% per year. The per-worker production function is y = 6k 12, where y is output per worker and k is capital per worker. The depreciation rate of capital is 14% per year. a. Households consume 90% of income and save the remaining 10% of income. There is no government. What are the steady-state values of capital per worker, output per worker, consumption per worker, and...
(24) Consider a closed economy in which the population grows at the rate of 2% per...
(24) Consider a closed economy in which the population grows at the rate of 2% per year. The depreciation rate of capital is 10% per year. The saving rate is 10% The per-worker production function is Yt = 4.8k0.5, where y is output per worker and k is capital per worker. The steady state growth rate of output per worker is equal to (A) 0% (B) 2% (C) 8% (D) 10% (25) Consider a closed economy in which the population...
ssume a closed economy without a government has a following production function The population grows at...
ssume a closed economy without a government has a following production function The population grows at 2 percent rate, and the depreciation rate is 5 percent. in the marginal propensity to consume is 79 percent, and the level of technology is 200, what would be the average income in the steady state? (5 points) b. What must the saving rate be to achieve the Golden Rule level of capital? (10 points)
Consider the Solow model with population growth and technological progress. The population grows at rate of...
Consider the Solow model with population growth and technological progress. The population grows at rate of d and the technology grows at rate of g. The depreciation rate of capital is λ. The aggregate production function is given as Y=100 ?![(1-u) ?]" where Y, K, L, ?, ? and u refers to aggregate output, aggregate capital stock, aggregate labor, output elasticity with respect to capital, output elasticity with respect to labor, and natural rate of unemployment, respectively. Draw a well-labeled...
Suppose that an economy has the per-worker production function given as: y = 4k., where y...
Suppose that an economy has the per-worker production function given as: y = 4k., where y is output per worker and k is capital per worker. In addition, national savings is given as: S, = 0.10Y, where S is national savings and Y is total output. The depreciation rate is d = 0.10 and the population growth rate is n = 0.10. The steady-state value of the capital-labor ratio, kis 4.00. The steady-state value of output per worker, y is...
Consider an economy that is characterized by the Solow Model. The (aggregate) production function is given...
Consider an economy that is characterized by the Solow Model. The (aggregate) production function is given by: Y = 6K1/3L2/3 In this economy, workers consume 80% of income and save the rest. The labour force is growing at 2% per year while the annual rate of capital depreciation is 5.5%. a) Solve for the steady state capital-labour ratio and consumption per worker. The economy is in its steady state as described in part (a). Suppose both the stock of capital...
5. (15%) Consider an economy at the long-run steady state. Population grows at rate gy and...
5. (15%) Consider an economy at the long-run steady state. Population grows at rate gy and the technology grows at the rate ga. Explain how each of the flowing would affect the steady state growth rates of K/AN, Y/AN, K/N, Y/N, K, and Y Illustrate your answers with appropriate graphs. a. The government reduces the tax rate on earnings from savings. b. Technological growth declines.
3. A closed economy has a production function: Y-K1 3L2/3, where K denotes machines and L...
3. A closed economy has a production function: Y-K1 3L2/3, where K denotes machines and L denotes workers. The population grows at a rate 2% per year and there is no technological progress. The depreciation rate is 3%. The saving rate, s, depends on the level of capital per worker, k, as follows: 5% if k < 5 (7k-30)% if 5 < k < 10 40% if k > 10 8 There are three steady states with k > 0:...
Suppose that an economy has the per-worker production function given as: y = 345 where y...
Suppose that an economy has the per-worker production function given as: y = 345 where y is output per worker and kis capital per worker. In addition, national savings is given as: S, = 0.3Y where S is national savings and Y is total output Use the production and savings functions on your left and the depreciation and population growth rates below to answer the following questions. (Round all numerical responses to one decimal place.) Depreciation rate (d) = 0.1...
Consider a version of the Solow model where population grows at rate n
Q1)Consider a version of the Solow model where population grows at rate n. Assume that technology is Cobb-Douglas so that output is given by Yt = KtαLt(1−α).Capital depreciates at rate δ and a fraction s of income is invested in physical capital every period.A. Write down an expression describing capital accumulation in this economy and solve for the steady-state levels of capital and output per worker. Illustrate your answer in a diagram.B. How is steady-state capital per worker affected by...
3) Consider a closed economy in which the population grows at the rate of 1% per year. The per-worker production function is y = 6k 12, where y is output per worker and k is capital per worker. The depreciation rate of capital is 14% per year. a. Households consume 90% of income and save the remaining 10% of income. There is no government. What are the steady-state values of capital per worker, output per worker, consumption per worker, and...
(24) Consider a closed economy in which the population grows at the rate of 2% per year. The depreciation rate of capital is 10% per year. The saving rate is 10% The per-worker production function is Yt = 4.8k0.5, where y is output per worker and k is capital per worker. The steady state growth rate of output per worker is equal to (A) 0% (B) 2% (C) 8% (D) 10% (25) Consider a closed economy in which the population...
ssume a closed economy without a government has a following production function The population grows at 2 percent rate, and the depreciation rate is 5 percent. in the marginal propensity to consume is 79 percent, and the level of technology is 200, what would be the average income in the steady state? (5 points) b. What must the saving rate be to achieve the Golden Rule level of capital? (10 points)
Suppose that an economy has the per-worker production function given as: y = 4k., where y is output per worker and k is capital per worker. In addition, national savings is given as: S, = 0.10Y, where S is national savings and Y is total output. The depreciation rate is d = 0.10 and the population growth rate is n = 0.10. The steady-state value of the capital-labor ratio, kis 4.00. The steady-state value of output per worker, y is...
5. (15%) Consider an economy at the long-run steady state. Population grows at rate gy and the technology grows at the rate ga. Explain how each of the flowing would affect the steady state growth rates of K/AN, Y/AN, K/N, Y/N, K, and Y Illustrate your answers with appropriate graphs. a. The government reduces the tax rate on earnings from savings. b. Technological growth declines.
3. A closed economy has a production function: Y-K1 3L2/3, where K denotes machines and L denotes workers. The population grows at a rate 2% per year and there is no technological progress. The depreciation rate is 3%. The saving rate, s, depends on the level of capital per worker, k, as follows: 5% if k < 5 (7k-30)% if 5 < k < 10 40% if k > 10 8 There are three steady states with k > 0:...
Suppose that an economy has the per-worker production function given as: y = 345 where y is output per worker and kis capital per worker. In addition, national savings is given as: S, = 0.3Y where S is national savings and Y is total output Use the production and savings functions on your left and the depreciation and population growth rates below to answer the following questions. (Round all numerical responses to one decimal place.) Depreciation rate (d) = 0.1...
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