In the Solow growth model, the main obstacle to continuous growth in output per effective worker is: O the declining marginal product of capital the limits in the ability of government policymakers the depreciation of capital too little savings the declining marginal product of labour
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- Write out the equation for output growth with capital, labor and total factor productivityas determinants of growth. Suppose that the shares of capital and labor are respectively0 .3 and 0.7. If labor supply grows by 10% what would be the growth rate of outputassuming that there is no change in the other determinants? What would happen to percapita output if labor supply growth is entirely due to population growth?In the Solow growth model, which of the following is/are the effect/s of an increase in the rate of technological progress? (i) higher capital-output ratio (ii) faster growth in output per worker (iii) faster growth in output O a. (i), (ii), and (iii) O b. Only (i) and (ii) O c. Only (1) and (iii) O d. Only (ii) and (iii)Sınav gezintisi Soru 2 Chapter 8: Economic Growth I: Capital Accumulation and Population Growth Henüz 1 3 4. 6. cevaplanmadı 5,00 üzerinden Question: If the capital stock in the Solow growth is constant, the ....... determines the level of output 10 11 12 13 14 15 16 işaretlenmiş and the establishes the distribution of output between ...... and P Soruyu 19 20 işaretle O a. depreciation rate / population growth rate / wages/ profits. Uygulamayı bitir . Kalan süre 0:23:27 b. production function/ saving rate/ consumption/investment. O c. population growth rate / saving rate /wages /profits. Od. production function/ saving rate /wages/ profits. e. saving rate/ production function / consumption/investment. TUR
- In the Solow growth model, if the economy's actual capital stock per worker is greater than the steady-state capital stock per worker, growth from convergence O A. detracts from the overall growth of the economy until the steady state is attained. O B. complicates the growth process and creates uncertainty regarding the overall growth of the economy. O C. adds to the overall growth of the economy until the steady state is attained. O D. neither adds to nor detracts from the overall growth of the economy.1. Define Capital Accumulation Equation under the Solow Growth ModelIn the Solow growth model, if y=A/K, s=0.1, n=0.05, A=10, d=0.05, then the steady state output per worker is O A. 10 O B. 50 OC. 100 O D.90 O E. 150
- In the Solow economic model, id like to know the relationship between the rate of population growth and the steady state level of income. I know that when the rate of population growth grow, then the breakeven investment line goes up, which decreses investment and capital per worker, but what does it do to the income level and the steady state rate of growth?Consider the Solow growth model with concave production function as studied in class. Supposethe economy is initially in the picture below, and currently has the level of capital stock of K0. What wouldhappen to the dynamics of capital accumulations when depreciation rate increases? Graphically denote thedirection and the speed of change/accumulation/decumulation of the capital stock, then verbally explain whythey move like so.If the current capital stock per person in South Korea is greater than the current capital stock per person in China and total factor productivity is the same in both countries, according to the Solow model: O a. China initially will grow slower than South Korea, but each will have the same steady state Ob. China initially will grow faster than South Korea, but each will have the same steady state О с. Both South Korea and China initially will grow at the same rate and have the same steady state O d. China initially will grow faster than South Korea and will have a lower steady state О . China initially will grow faster than South Korea and will have a higher steady state
- What is the mechanism in the Solow model that generates growth? Why isthis an appealing mechanism? Why does it fail to deliver economic growth inthe long run?11. Alter the Solow growth model so that the pro- duction technology is given by Y= zK, where Y is output, K is capital, and z is total factor pro- ductivity. Thus, output is produced only with саpital. (a) Show that it is possible for income per person to grow indefinitely. (b) Also show that an increase in the savings rate increases the growth rate in per capita income.Consider a standard Solow-Swan model. A permanent increase in the level of total factor productivity will lead to an increase in investment per worker in the short run and in the long run will increase investment as a share of GDP.True or False? Explain.f