In the nation of Wooknam, the capital share of GDP is 40 percent, the average growth...
In the nation of Wooknam, the capital share of GDP is 40 percent, the average growth in output is 5.0 percent per year, the depreciation rate is 7.0 percent per year, and the capital–output ratio is 4.5. Suppose that the production function is Cobb–Douglas and that Wooknam has been in a steady state.
Round answers to two places after the decimal when necessary.
b. In the initial steady state, what is the marginal product of capital (MPK)?
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In the nation of Wooknam, the capital share of GDP is 40
percent, the average growth...
In the nation of Wiknam, the capital share of GDP is 40 percent, the average growth...
In the nation of Wiknam, the capital share of GDP is 40 percent,
the average growth in output is 4 percent per year, the
depreciation rate is 6 percent per year, and the capital–output
ratio is 5. Suppose that the production function is Cobb–Douglas
and that Wiknam has been in a steady state. (For a discussion of
the Cobb–Douglas production function, see Chapter 3.)
c. Suppose that public policy alters the saving rate so
that the economy reaches the Golden...
Economic Growth II — Work It Out Question 2 In the nation of Wooknam, the capital...
Economic Growth II — Work It Out Question 2 In the nation of Wooknam, the capital share of GDP is 35 percent, the average growth in output is 3.0 percent per year, the depreciation rate is 5.0 percent per year, and the capital-output ratio is 4.5. Suppose that the production function is Cobb- Douglas and that Wooknam has been in a steady state. Round answers to two places after the decimal when necessary. a. In the initial steady state, what...
Economic Growth II — Work It Out Question 2 In the nation of Wooknam, the capital...
Economic Growth II — Work It Out Question 2 In the nation of Wooknam, the capital share of GDP is 40 percent, the average growth in output is 3.0 percent per year, the depreciation rate is 6.5 percent per year, and the capital output ratio is 4.5. Suppose that the production function is Cobb! Douglas and that Wooknam has been in a steady state. Round answers to two places after the decimal when necessary. c. Suppose that public policy alters...
3. LaunchPad. In the United States, the capital share of GDP is about 30 percent, the...
3. LaunchPad. In the United States, the capital share of GDP is about 30 percent, the average growth in output is about 3 percent per year, the depreciation rate is about 4 percent per year, and the capital-output ratio is about 2.5. Suppose that the production function is Cobb-Douglas and that the United States has been in a steady state. (For a discussion of the Cobb-Douglas production function, see Chapter 3.) a. What must the saving rate be in the...
Steady state question
The capital share of GDP is about 40 percent, the average growth in output is about2 percent per year, the depreciation rate is about 3 percent per year, and the capital–output ratiois about 1.5. Suppose that the production function is Cobb–Douglas andin a steady state.a. What must the saving rate be in the initial steady state? [Hint: Use the steady-staterelationship, sy = (δ + n + g)k.]b. What is the marginal product of capital in the initial steady state?c. Suppose...
If the U.S. production function is Cobb–Douglas with capital share 0.3, output growth is 3 percent per year, depreciatio...
If the U.S. production function is Cobb–Douglas with capital share 0.3, output growth is 3 percent per year, depreciation is 4 percent per year, and the Golden Rule steady-state capital–output ratio is 4.29, to reach the Golden Rule steady state, the saving rate must be: A) 17.5 percent. B) 25 percent. C) 30 percent. D) 42.9 percent.
Capital share in steady State
In a country the capital share of GDP is 4%, average growth in output is 2% per year, depreciation is 3% per year, capital output ratio is 1.5, suppose the function is cobb-doglas and the country is in steady State.1. What is the saving rate in the initial steady State using sy= (d +n+ g
An economy has a Cobb-Douglas production function: Y = K"(LE)!-a The economy has a capital share...
An economy has a Cobb-Douglas production function: Y = K"(LE)!-a The economy has a capital share of 0.25, a saving rate of 40 percent, a depreciation rate of 3.00 percent, a rate of population growth of 0.75 percent, and a rate of labor- augmenting technological change of 2.0 percent. It is in steady state. b. Solve for capital per effective worker (k*), output per effective worker (y*), and the marginal product of capital.
An economy has a Cobb-Douglas production function: Y = K°(LE)1-a The economy has a capital share...
An economy has a Cobb-Douglas production function: Y = K°(LE)1-a The economy has a capital share of 0.25, a saving rate of 43 percent, a depreciation rate of 3.00 percent, a rate of population growth of 4.25 percent, and a rate of labor-augmenting technological change of 3.5 percent. It is in steady state. b. Solve for capital per effective worker (k*), output per effective worker (y*), and the marginal product of capital. k* = 2.83 y* * = 1.30 =...
15. Consider an economy, with a production function given by Y-AK03L07. This economy's annual GDP growth...
15. Consider an economy, with a production function given by Y-AK03L07. This economy's annual GDP growth rate is 5%. Also assume that L and Kare both growing at annual rates of 2%. Calculate the growth rate of total factor productivity for this economy. a. 2.0% b. 3.0% 4.0% c. d. 5.0% 16. Suppose output is determined by a Cobb-Douglas production function Y=AK L1 Where 0ca<1. If total factor productivity (A) remains constant, but labour (L) and capital (K) inputs both...
In the nation of Wiknam, the capital share of GDP is 40 percent,
the average growth in output is 4 percent per year, the
depreciation rate is 6 percent per year, and the capital–output
ratio is 5. Suppose that the production function is Cobb–Douglas
and that Wiknam has been in a steady state. (For a discussion of
the Cobb–Douglas production function, see Chapter 3.)
c. Suppose that public policy alters the saving rate so
that the economy reaches the Golden...
Economic Growth II — Work It Out Question 2 In the nation of Wooknam, the capital share of GDP is 35 percent, the average growth in output is 3.0 percent per year, the depreciation rate is 5.0 percent per year, and the capital-output ratio is 4.5. Suppose that the production function is Cobb- Douglas and that Wooknam has been in a steady state. Round answers to two places after the decimal when necessary. a. In the initial steady state, what...
Economic Growth II — Work It Out Question 2 In the nation of Wooknam, the capital share of GDP is 40 percent, the average growth in output is 3.0 percent per year, the depreciation rate is 6.5 percent per year, and the capital output ratio is 4.5. Suppose that the production function is Cobb! Douglas and that Wooknam has been in a steady state. Round answers to two places after the decimal when necessary. c. Suppose that public policy alters...
3. LaunchPad. In the United States, the capital share of GDP is about 30 percent, the average growth in output is about 3 percent per year, the depreciation rate is about 4 percent per year, and the capital-output ratio is about 2.5. Suppose that the production function is Cobb-Douglas and that the United States has been in a steady state. (For a discussion of the Cobb-Douglas production function, see Chapter 3.) a. What must the saving rate be in the...
An economy has a Cobb-Douglas production function: Y = K"(LE)!-a The economy has a capital share of 0.25, a saving rate of 40 percent, a depreciation rate of 3.00 percent, a rate of population growth of 0.75 percent, and a rate of labor- augmenting technological change of 2.0 percent. It is in steady state. b. Solve for capital per effective worker (k*), output per effective worker (y*), and the marginal product of capital.
An economy has a Cobb-Douglas production function: Y = K°(LE)1-a The economy has a capital share of 0.25, a saving rate of 43 percent, a depreciation rate of 3.00 percent, a rate of population growth of 4.25 percent, and a rate of labor-augmenting technological change of 3.5 percent. It is in steady state. b. Solve for capital per effective worker (k*), output per effective worker (y*), and the marginal product of capital. k* = 2.83 y* * = 1.30 =...
15. Consider an economy, with a production function given by Y-AK03L07. This economy's annual GDP growth rate is 5%. Also assume that L and Kare both growing at annual rates of 2%. Calculate the growth rate of total factor productivity for this economy. a. 2.0% b. 3.0% 4.0% c. d. 5.0% 16. Suppose output is determined by a Cobb-Douglas production function Y=AK L1 Where 0ca<1. If total factor productivity (A) remains constant, but labour (L) and capital (K) inputs both...
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