Homework Answers
If the economy begins at with the initial capital stock at K1 , Steady state is where investment curve and depreciation curve intersetc each other . Hence K1 will rise to K2 at meed the steady state . Hence capitak stock will rise .
Hence (4) part is a correct answer
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In the figure below, if the economy begins with the initial capital stock at K1, the...
QUESTION 6 Let fvı and fv(3) in K1 and K3 locations respectively in the figure. No...
QUESTION 6 Let fvı and fv(3) in K1 and K3 locations respectively in the figure. No K1 and K3. Assuming that the force f(t) is from M2 to the left, find the transfer function as X1 (s)/F (S). X2(1) fra K3.1 K 0000 M M 0000 K2 0000 fvi fuz
10. Consider the figure below that provides an illustration of the dynamics of the Solow model....
10. Consider the figure below that provides an illustration of the dynamics of the Solow model. Suppose that the initial capital per-worker is ki (depicted in the figure). What type of change would allow the capital per worker to remain at ki (stays constant)? Steady-state investment per worker, (11 + d)k Saving per worker and investment per worker Saving per worker, sf (k) sfik) Capital-labor ratio, k (a) A reduction in the saving rate. (b) A decrease in population growth....
Part 1 (1 point) See Hin Now, suppose the city is picked to host the Olympics,...
Part 1 (1 point) See Hin Now, suppose the city is picked to host the Olympics, and it starts to make investments to get ready, causing the city to operate along F1. Consider several possible choices available to the city about how much investment it should make. All of these choices will place the city's economy along F1 First, suppose the city decides to keep its level of capital at K1. In this case, the investments directed toward preparing for...
Refer to the figure above. Suppose that output per effective worker in the economy is at...
Refer to the figure above. Suppose that output per effective worker in the economy is at point C. Suppose nothing else changes in the model exogenously. Which of the following statements is correct? Capital per effective worker will not change and will remain at its current level Capital per effective worker must decrease over time More information is needed to determine what will happen to capital per effective worker Capital per effective worker must increase over time YIAN f(K/AN) f...
Solow Growth Model: Consider an economy with the following features: • Y = K 0.25 0.75...
Solow Growth Model: Consider an economy with the following features: • Y = K 0.25 0.75 • 8 = 0.02 • n=0 . g=0 i. Does the production function exhibit decreasing, constant, or increasing returns to scale? How do you know? ii. Determine MPK. Tii. Does the production function exhibit increasing, constant, or diminishing marginal product of labour? How do you know? iv. Re-express the production function in per worker terms. v. Determine the value of k in three periods...
Assume an economy is populated by L workers with total capital stock K. Production of this...
Assume an economy is populated by L workers with total capital stock K. Production of this KL. Suppose household's saving rate s economy is organized by Y 0.6, and firm's depreciation rate of capital d = 0.1. The rule for accumulation of captial in per worker terms is of the time-to-build type: A k = i - ôk Standard Transformation of the Production Function a. Show that the production function is constant return to scale (CRS) b. Rewrite the production...
Question 10 Initially, there is a negative net capital outflow in a small open economy with...
Question 10 Initially, there is a negative net capital outflow in a small open economy with a perfect capital mobility. Suppose an investment tax credit is introduced to give a tax advantage to any firm building a new factory or buying a new piece of equipment. Which of the following statement is correct in the loanable funds market? A. Savings increase and investment increases. B. Savings decrease and investment increases. C. Savings increase and investment remains unchanged. D. Savings remain...
ALL OF THE QUESTIONS PLS!!! Assume an economy is populated by L workers with total capital stock K. Production of this...
ALL OF THE QUESTIONS PLS!!!
Assume an economy is populated by L workers with total capital stock K. Production of this KL. Suppose household's saving rate s economy is organized by Y 0.6, and firm's depreciation rate of capital d = 0.1. The rule for accumulation of captial in per worker terms is of the time-to-build type: A k = i - ôk Standard Transformation of the Production Function a. Show that the production function is constant return to scale...
good weekend! Problem 1 Assume an economy is populated by L workers with total capital stock...
good weekend! Problem 1 Assume an economy is populated by L workers with total capital stock K. Production of this economy is organized by Y = K L.. Suppose household's saving rate s = 0.6, and firm's depreciation rate of capital 8 = 0.1. The rule for accumulation of captial in per worker terms is of the time-to-build type: Ak=¿- Sk. Standard Transformation of the Production Function a. Show that the production function is constant return to scale (CRS). b....
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:...
QUESTION 6 Let fvı and fv(3) in K1 and K3 locations respectively in the figure. No K1 and K3. Assuming that the force f(t) is from M2 to the left, find the transfer function as X1 (s)/F (S). X2(1) fra K3.1 K 0000 M M 0000 K2 0000 fvi fuz
10. Consider the figure below that provides an illustration of the dynamics of the Solow model. Suppose that the initial capital per-worker is ki (depicted in the figure). What type of change would allow the capital per worker to remain at ki (stays constant)? Steady-state investment per worker, (11 + d)k Saving per worker and investment per worker Saving per worker, sf (k) sfik) Capital-labor ratio, k (a) A reduction in the saving rate. (b) A decrease in population growth....
Part 1 (1 point) See Hin Now, suppose the city is picked to host the Olympics, and it starts to make investments to get ready, causing the city to operate along F1. Consider several possible choices available to the city about how much investment it should make. All of these choices will place the city's economy along F1 First, suppose the city decides to keep its level of capital at K1. In this case, the investments directed toward preparing for...
Solow Growth Model: Consider an economy with the following features: • Y = K 0.25 0.75 • 8 = 0.02 • n=0 . g=0 i. Does the production function exhibit decreasing, constant, or increasing returns to scale? How do you know? ii. Determine MPK. Tii. Does the production function exhibit increasing, constant, or diminishing marginal product of labour? How do you know? iv. Re-express the production function in per worker terms. v. Determine the value of k in three periods...
Assume an economy is populated by L workers with total capital stock K. Production of this KL. Suppose household's saving rate s economy is organized by Y 0.6, and firm's depreciation rate of capital d = 0.1. The rule for accumulation of captial in per worker terms is of the time-to-build type: A k = i - ôk Standard Transformation of the Production Function a. Show that the production function is constant return to scale (CRS) b. Rewrite the production...
ALL OF THE QUESTIONS PLS!!!
Assume an economy is populated by L workers with total capital stock K. Production of this KL. Suppose household's saving rate s economy is organized by Y 0.6, and firm's depreciation rate of capital d = 0.1. The rule for accumulation of captial in per worker terms is of the time-to-build type: A k = i - ôk Standard Transformation of the Production Function a. Show that the production function is constant return to scale...
good weekend! Problem 1 Assume an economy is populated by L workers with total capital stock K. Production of this economy is organized by Y = K L.. Suppose household's saving rate s = 0.6, and firm's depreciation rate of capital 8 = 0.1. The rule for accumulation of captial in per worker terms is of the time-to-build type: Ak=¿- Sk. Standard Transformation of the Production Function a. Show that the production function is constant return to scale (CRS). b....
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:...
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