Complete solutions need .only 100% sure experts solve it 1. The formulae r-g> 0 in Thomas Piketty's Capital In the Twenty-FirstCentury states that the net rate of return of capital (r) exceeds the growth rate(a). He argues that wealth inequality is set to rise from its low levels in the1950s through 1970s to the very high levels.Consider the Ramsey model with a CRRA utility function:C- −1u =σ 1.1-σBased on the relationship between r and g in the Ramsey modei covered inthe class, discuss the implication of the relation between r and g in the Ramseymodel in Korean or in English. (Hint: = kt =g at the balanced growthpath.)Ct=Yt

Step 1:Ramsey model with a CRRA utility function, balanced growth path occurs when consumption (ct),…

Answered: 1. The formulae r-g> 0 in Thomas…

Practical Management Science

6th Edition

ISBN:9781337406659

Author:WINSTON, Wayne L.

Publisher:WINSTON, Wayne L.

Chapter2: Introduction To Spreadsheet Modeling

Section: Chapter Questions

Problem 38P: Suppose you are borrowing 25,000 and making monthly payments with 1% interest. Show that the monthly...

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Suppose you are borrowing 25,000 and making monthly payments with 1% interest. Show that the monthly payments should equal 556.11. The key relationships are that for any month t (Ending month t balance) = (Ending month t 1 balance) ((Monthly payment) (Month t interest)) (Month t interest) = (Beginning month t balance) (Monthly interest rate) Of course, the ending month 60 balance must equal 0.
Assume that for a closed economy, E = C + I + G,where E = Total expenditure on Consumption Goods,I = Exp. on Investment GoodsG = Govt. spendingFor equilibrium, we must have E=Y, Y being total income received.For a certain Economy, it is given that C=15 + 0.9Y, where I=20 + 0.05Y and G=25.Find the equilibrium values of Y, C, and I. How will these change, if there is no Govt.spending?
(3) How to interpret relationship between changes of GDP growth rate and unemployment rate? Now go to your notes (slides). Is the relationship you plotted similar as the Okun's Law predicts? Suppose you got a relation as GDP = a + b * UNemp, Are the coefficients of a and b are close to the value of Okun's Law? (4) Now repeat the plot you did in part (2) above. However, this time you use the sample only from 2000 to 2019. Any change to the relationship? How is the value of a and b in this sample?
EBIT of different Firms are as follows, Interest (I) at 10% and Equity Capitalization Rate (Ke) below, calculate the Total Market Value of each firm and interpret. Explain the relevance of EBIT-EPS analysis, Indifference point and Financial Breakeven Point to firms. Firms EBIT I Ke (%) A 400000 40000 12% B 600000 120000 16% C 1000000 400000 15% D 1200000 480000 18%
The consumption function for a closed economy with no government sector is given by theequation:C = £200 million + 0.8 Ywhere C is aggregate consumption and Y is national income.(i) Calculate the value of aggregate savings if the level of national income is £4000 million.(ii) Calculate the equilibrium level of national income if the level of planned investment is£600 million(iii) Calculate the level of aggregate consumption at the equilibrium level of nationalincome if the level of planned investment is £1000 million(iv) Calculate the change in national income if planned investment rose from £600 millionto £800 million
Chris owes the bank $30. His friend Morgan owes the bank $18 Which inequality correctly expresses the relationship of the money they each owes ? Mark all that apply A -18>-30 B -1830 D -30
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Please answer along with the excel formulas - 1. Sue now has $125. How much would she have after 8 years if she leaves it invested at 8.5% with annual compounding? $205.83 $216.67 $228.07 $240.08 $252.08 2. Suppose you have $1,500 and plan to purchase a 5-year certificate of deposit (CD) that pays 3.5% interest, compounded annually. How much will you have when the CD matures? $1,781.53 $1,870.61 $1,964.14 $2,062.34 $2,165.46 3. Last year Rocco Corporation's sales were $225 million. If sales grow at 6% per year, how large (in millions) will they be 5 years later? $271.74 $286.05 $301.10 $316.16 $331.96
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Suppose the economy is in recession. Policymakers estimate that aggregate demand is$100 billion short of the amount necessary to generate the long run natural rate of output.That is, if aggregate demand were shifted to the right by $100 billion, the economy wouldbe in long run equilibrium.a. Explain the impact on the economy if the government chooses to use fiscal policy tostabilize the economy and the marginal propensity to consume (MPC) is given as0.75 with no crowding out.b. If there is a crowding out effect and investment is very sensitive to changes in theinterest rate, should the government increase spending more or less than this amount?
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