Consider the following fictional statistics for three different economies. Using the production function ?? = ????...
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Consider the following fictional statistics for three
different economies. Using the production
function ?? = ????...
2. Growth accounting: Consider the following (made-up) statistics for some economies. As sume the exponent on...
2. Growth accounting: Consider the following (made-up) statistics for some economies. As sume the exponent on capital is 1/3 and that the labor composition is unchanged. For each economy, compute the growth rate of TFP. (a) A European economy: gt/1 = 0.033x/L = 0.03. (b) A Latin American economy: gy/L=0.02, gK/L (c) An Asian economy: gY/L = 0.06. gK/L = 0.15. 0.01
(Steady state in the Solow model) Consider two economies identical in everything except the production function.
3. (Steady state in the Solow model) Consider two economies identical in everything except the production function. Economy 1 has a production function \(F(K, L)=K^{\alpha} L^{1-\alpha}\), economy 2 has a production function \(G(K, L)=\alpha K+(1-\alpha) L\). For both economies capital grows according to (1).a) Write output per worker as a function of capital per worker for both economies.b) Compute the steady state value of capital per worker for both these economies or, if it does not exist, show graphically that...
3. (Steady state in the Solow model) Consider two economies identical in everything except the production...
3. (Steady state in the Solow model) Consider two economies identical in everything except the production function. Economy 1 has a production function F(K, L)KoL1-a, economy 2 has a production function G(K, L)-aK(1-a)L. For both economies capital grows according to (1). a) Write output per worker as a function of capital per worker for both economies. b) Compute the steady state value of capital per worker for both these economies or, if it does not exist, show graphically that it...
Consider two economies, one developing and one developed. Both economies have access to the production function...
Consider two economies, one developing and one developed. Both economies have access to the production function shown below, but the developed economy utilizes four units of capital, while the developing country utilizes one unit of capital. Part 1 According to the Solow growth model, you would expect the to be closer to its steady state. Part 2 According to the Solow model, investment in the would yield relatively greater returns.Part 3 The Solow model predicts that, over time, real GDP in developing economies could potentially...
3. (Steady state in the Solow model) Consider two economies identical in everything except the production...
3. (Steady state in the Solow model) Consider two economies identical in everything except the production function. Economy 1 has a production function F(K, L) KL,economy 2 has a production function G(K, L) aK1 - a)L. For both economies capital grows according to (1). a) Write output per worker as a function of capital per worker for both economies. b) Compute the steady state value of capital per worker for both these economies or, if it does not exist, show...
Exercise 1. Production function model Consider an economy "I" with a representative household that consists of...
Exercise 1. Production function model Consider an economy "I" with a representative household that consists of 1000 workers and owns $100 million of capital (L 1000, K -100). There is a representative firm with a Cobb- Douglas production function that rents capital and hires labor to produce. Assume that the TFP parameter equals one (A-1), we have Y K1/3L2/3. Markets are competitive. 1. Define an equilibrium in this economy. Follow class notes. 2. Solve for the equilibrium. You should get...
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...
Scenario: Two economies, A and B, have identical aggregate production functions with diminishing returns. In both...
Scenario: Two economies, A and B, have identical aggregate production functions with diminishing returns. In both economies, capital and labor are equally important for production. Economy A has twice as many efficiency units of labor as economy B. Economy B has twice as much physical capital stock as economy A. Refer to the scenario above. Over time, economy A develops sophisticated technology, and human capital becomes less and less valuable in the production of goods and services that require more...
3) Consider the production function ? = 6? 0.3? 0.6 . The marginal products are ???...
3) Consider the production function ? = 6? 0.3? 0.6 . The marginal products are ??? = 1.8? −0.7? 0.6 and ??? = 3.6? 0.3? −0.4 . a. In the short run assume that capital is fixed at ? = 10. Derive formulas for the short-run Total Product (TP), Average Product (APL), and Marginal Product (MPL). Graph these three functions. b. In the long run, capital is not fixed. Graph the isoquant for ? = 6. Identify and label three...
Problem 3. Suppose that output in the economy can be defined by the following production function...
Problem 3. Suppose that output in the economy can be defined by the following production function F(K,N) VKAN, where A is the technology parameter that remains constant at A 10. Labor force grows at 4% per annum, the capital depreciation rate equals 16% and people consume 90% of their income. a) b) c) d) Find the intensive form of the production function (per worker). Find the steady-state level of capital per worker and output per worker. Present the appropriate graph....
2. Growth accounting: Consider the following (made-up) statistics for some economies. As sume the exponent on capital is 1/3 and that the labor composition is unchanged. For each economy, compute the growth rate of TFP. (a) A European economy: gt/1 = 0.033x/L = 0.03. (b) A Latin American economy: gy/L=0.02, gK/L (c) An Asian economy: gY/L = 0.06. gK/L = 0.15. 0.01
3. (Steady state in the Solow model) Consider two economies identical in everything except the production function. Economy 1 has a production function \(F(K, L)=K^{\alpha} L^{1-\alpha}\), economy 2 has a production function \(G(K, L)=\alpha K+(1-\alpha) L\). For both economies capital grows according to (1).a) Write output per worker as a function of capital per worker for both economies.b) Compute the steady state value of capital per worker for both these economies or, if it does not exist, show graphically that...
3. (Steady state in the Solow model) Consider two economies identical in everything except the production function. Economy 1 has a production function F(K, L)KoL1-a, economy 2 has a production function G(K, L)-aK(1-a)L. For both economies capital grows according to (1). a) Write output per worker as a function of capital per worker for both economies. b) Compute the steady state value of capital per worker for both these economies or, if it does not exist, show graphically that it...
Consider two economies, one developing and one developed. Both economies have access to the production function shown below, but the developed economy utilizes four units of capital, while the developing country utilizes one unit of capital. Part 1 According to the Solow growth model, you would expect the to be closer to its steady state. Part 2 According to the Solow model, investment in the would yield relatively greater returns.Part 3 The Solow model predicts that, over time, real GDP in developing economies could potentially...
3. (Steady state in the Solow model) Consider two economies identical in everything except the production function. Economy 1 has a production function F(K, L) KL,economy 2 has a production function G(K, L) aK1 - a)L. For both economies capital grows according to (1). a) Write output per worker as a function of capital per worker for both economies. b) Compute the steady state value of capital per worker for both these economies or, if it does not exist, show...
Exercise 1. Production function model Consider an economy "I" with a representative household that consists of 1000 workers and owns $100 million of capital (L 1000, K -100). There is a representative firm with a Cobb- Douglas production function that rents capital and hires labor to produce. Assume that the TFP parameter equals one (A-1), we have Y K1/3L2/3. Markets are competitive. 1. Define an equilibrium in this economy. Follow class notes. 2. Solve for the equilibrium. You should get...
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...
Problem 3. Suppose that output in the economy can be defined by the following production function F(K,N) VKAN, where A is the technology parameter that remains constant at A 10. Labor force grows at 4% per annum, the capital depreciation rate equals 16% and people consume 90% of their income. a) b) c) d) Find the intensive form of the production function (per worker). Find the steady-state level of capital per worker and output per worker. Present the appropriate graph....
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