FiltersDone

Question type

Essay

Multiple Choice

Short Answer

True False

Matching

Exam 6: Long-Run Economic Growth

Show Answer

Share

---

All types

Filters

Study FlashcardsPractice ExamLearn

Question 41

Multiple Choice

Review LaterAdd Note

Review Later

In the Solow model,if saving per worker initially exceeds investment per worker,

A) the economy will experience inflation.
B) the capital-labor ratio will increase.
C) investment per worker will decline.
D) saving per worker will decline.

E) None of the above
F) B) and D)

Correct Answer

verified

Show Answer

Question 42

Multiple Choice

Review LaterAdd Note

Review Later

Over the past year,output grew 5%,capital grew 5%,and labor grew 1%.If the elasticities of output with respect to capital and labor are 0.5 and 0.5,respectively,how much did productivity grow?

A) 0) 5%
B) 1) 0%
C) 1) 5%
D) 2) 0%

E) A) and B)
F) All of the above

Correct Answer

verified

Show Answer

Question 43

Multiple Choice

Review LaterAdd Note

In the Solow model,if f(k) = 2k^0.5,s = 0.3,n = 0.05,and d = 0.15,what is the value of k at equilibrium?

A decrease in population growth will lead to a ________ in the steady-state capital-labor ratio and a ________ in output per worker.

Steady-state investment per worker is positively related to the capital-labor ratio because the higher the capital-labor ratio

In the absence of productivity growth,in a steady-state economy

Over the past year,productivity grew 1%,capital grew 2%,and labor grew 2%.If the elasticities of output with respect to capital and labor are 0.3 and 0.7,respectively,how much did output grow?

Country A has a capital-labor ratio that is initially twice as big as that of country B,but neither is yet in a steady state.Both countries have the same production function,f(k)= 6k^1/2.Country A has a 10% saving rate,10% population growth rate,and 5% depreciation rate,while country B has a 20% saving rate,10% population growth rate,and 20% depreciation rate. (a)Calculate the steady-state capital-labor ratio for each country.Does the initial capital-labor ratio affect your results? (b)Calculate output per worker and consumption per worker for each country.Which country has the highest output per worker? The highest consumption per worker?

In the textbook model of endogenous growth,long-run output growth would decline if there were either a ________ in the saving rate or a ________ in the depreciation rate.

Suppose the current level of output is 5000 and the elasticity of output with respect to labor is 0.7.A 10% increase in labor would increase the current level of output to

Suppose the current level of output is 5000.If the elasticities of output with respect to capital and labor are 0.3 and 0.7,respectively,a 10% increase in capital combined with a 5% increase in labor and a 5% increase in productivity would increase the current level of output to

A new pollution law requires businesses to pay for inspections of their plants by independent pollution-monitoring firms.What effect is this likely to have?

Government policies to raise the rate of productivity growth include all of the following except

An increase in population growth will lead to a ________ in the steady-state capital-labor ratio and a ________ in output per worker.

A productivity improvement will cause

Describe the main ideas of endogenous growth theory.What does it have to say about the role of government in economic growth?

A country has the per-worker production function y_t = 6, where y_t is output per worker and k_t is the capital-labor ratio.The depreciation rate is 0.1 and the population growth rate is 0.1.The saving function is S_t = 0.1Y_t, where S_t is total national saving and Y_t is total output. (a)What is the steady-state value of capital-labor ratio? (b)What is the steady-state value of output per worker? (c)What is the steady-state value of consumption per worker?

Labor productivity increased so much in the second half of the 1990s because of

A country has the per-worker production function y_t = 5, where y_t is output per worker and k_t is the capital-labor ratio.The depreciation rate is 0.2 and the population growth rate is 0.05.The saving function is S_t = 0.2Y_t, where S_t is total national saving and Y_t is total output. (a)What is the steady-state value of the capital-labor ratio? (b)What is the steady-state value of output per worker? (c)What is the steady-state value of consumption per worker?

Over the past year,output grew 4%,capital grew 2%,and labor grew 1%.If the elasticities of output with respect to capital and labor are 0.3 and 0.7,respectively,how much did productivity grow?