1) Calculation of economic growth rate
Rate of Growth of GDP = Savings ratio / Capital output Ratio
Rate of growth of GDP = 15 / 3 = 5%
2) Calculation of saving rate
Savings ratio = Rate of Growth of GDP * Capital Output ratio
Savings ratio = 15 * 3 = 45%
Consider the Harrod-Domar model of economic growth. Assume that the capital-output ratio is 3. (a) [5...
11. Approximately what is the ratio of per capita income in North America and that in East Asia (see fig. 1.11)? Between North America and South Asia? 95% TABLE 1.1 Quality-of-Life Indicators LEAST-DEVELOPED MOST-DEVELOPED COUNTRIES COUNTRIES GDP/Person (US$1671 (US$35,768 Poverty Index 781% 0 Life Expectancy 58 years 80 years Adult Literacy 58% 99% Female Secondary 11% Education Total Fertility Infant Mortality 120 Improved Sanitation 23% 100% Improved Water 616 100% co/capita 02 tons 13 tons ANNUAL gross domestic product 2PERCENT...