4. Explain the idea of the macroeconomic production function to someone whoknows no economics. The production function we have discussed relates outputper capita to technology, labor (and population growth rate), capital, and hu-man capital. We should properly think of all of these variables as endogenousvariables. Think about policies that would affect these. Articulate three policyrecommendations for each. Be careful about the distinction between labor andpopulation. Do you think policies that would maximize investment would alsomaximize welfare?5. Using the Solow model, explain the effects of the following events on steadystate income per capita level and income per capita growth rate of countryAdanus using proper terminology:(a) Aliens attack Adanus and destroy all existing factories. Thankfully, thecitizens were not affected by the attacks.(b) Adanus receives a large influx of migrants from Mersinis. Population in-creases overnight. The migrants have the same fertility rate as locals.(c) People of Adanus decided to spend less on kebap and çöp şiş due to healthreasons. As a result, saving rate in the country increases.

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4. Explain the idea of the macroeconomic production function to someone who knows no economics. The production function we have discussed relates output per capita to technology, labor (and population growth rate), capital, and hu- man capital. We should properly think of all of these variables as endogenous variables. Think about policies that would affect these. Articulate three policy recommendations for each. Be careful about the distinction between labor and population. Do you think policies that would maximize investment would also maximize welfare?

4. Explain the idea of the macroeconomic production function to someone who knows no economics. The production function we have discussed relates output per capita to technology, labor (and population growth rate), capital, and hu- man capital. We should properly think of all of these variables as endogenous variables. Think about policies that would affect these. Articulate three policy recommendations for each. Be careful about the distinction between labor and population. Do you think policies that would maximize investment would also maximize welfare?

Exploring Economics

8th Edition

ISBN:9781544336329

Author:Robert L. Sexton

Publisher:Robert L. Sexton

Chapter20: Economic Growth In The Global Economy

Section: Chapter Questions

Problem 4P

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Similar questions

What do the growth accounting studies conclude are the determinants of growth? Which is more important, the determinants or how they am combined?
An economy starts off with a GDP per capita of 5,000. How large will the GDP per capita be if it grows at an annual rate of 2 for 20 years? 2 for 40 years? 4 for 40 years? 6 for 40 years?
PER CAPITA OUTPUT to YEAR In the Romer model in figure above, at time to, a change in the shape of the production function can be explained by an increase in the: Select one: O a. ideas efficiency parameter. O b. population. O c. saving rate. O d. share of labor engaged in research. O e. growth rate.
Jtilizing the aggregate production functions to the right, Robert Solow asserted that the most significant or critical factor in driving long term economic growth is and is reflected in the movement from to O A. capital accumulation; "B" to C" Production function3 D B. technological change; "A" to "B" Production function2 O C. economies of scale; "D" to "C" O D. technological change; "B" to "C Production function, :B O E. capital accumulation; "A" to "C" $40 Capital per hour worked (K/L) 60 Click to select your answer. la 19 Lhednge SSS-76 DOCX cBook Air F9 F10 F11 F12 F7 F8 + 8 9 del Real GDP per houraorked (Y/L)
What were the sources of labor productivity growth in the U.S. economy during the sixty years since 1960? How did the 1960s differ from the more recent decades? During the sixty years since 1960, the sources of labor productivity growth include O A. plastics, the laser, and the computer during the 1960s, and the Internet during later years O B. the focus on saving energy during the 1970s O C. the wide-spread introduction of the Internet during the 1970s O D. the global financial turmoil of 2008-2009 that made labor more productive Comparing the 1960s to the more recent decades, labor productivity growth than in subsequent decades. O A. in the 1960s was approximately 25 percent higher O B. in the 1960s was smaller C. due to technological change was smaller in the 1960s O D. due to physical capital and human capital growth was greater in the 1960s Click to select your answer. MacBook A
When economists speak of "long-run economic growth, they mean increasing the Select one: O a. real GDP of a country. O O O b. geographic size of a country. c. per capita real GDP of a country. d. population of a country. According to the instructors calculations, the average person in the United States spends Select one: O O O O a. approximately 5 and ½ hours b. about 3 and ½ hours c about 8 hours d. 45 minutes On a graph with savings on the x-axis and real interest rates on the y-axis, the supply of savings curve following the law of supply would: Select one: O O O O a. be horizontal a day in activities needed to continue living (what he described as not dying b. have a negative slope c. be vertical d. have a positive slope
Economics, physical capital represents the uildings or machines used by a business to produce product. The marginal product of physical capital presents the rate of change of output product with spect to physical capital (informally, if you increase e size of your factory a little, how much more Foduct can you create?). articular model tells us that the output product Y is given, a function of capital K, by Y = AKªL'-a ere A is a constant, L is units of labor (assumed to be stant), and a is a constant between 0 and 1. Determine marginal product of physical capital predicted by this del. ned with CamScanner
For an economy described by the production model where labor's share of income is constant and equal to 2/3, the rate of increase of wages will be equal to Select one or more: a. The rate of increase of A or total factor productivity plus 2/3 times the rate of increase of capital per worker. O b. The rate of increase of 2/3 times output per worker. C. The rate of increase of output per worker. n d. The rate of increase of A or total factor productivity plus 1/3 times the rate of increase of capital per worker. Consider a CES production function with the elasticity of substitution equal to 2. What happens to the capital payment share if the rental to wage ratio rises? Select one: O a. It does not change. O b. It increases. O c. Not enough information is given to answer this question. O d. It decreases.
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Economic growth may be described as? Select one: O a. An increase in money available to the economy O b. An increase in employment O. An increase in training in the economy Od. An increase in GDP over time
Consider the production functions shown here, which show the output of a bakery over time. Suppose that the bakery experiences significant wear and tear of its ovens and that this leads some of the ovens to break down, Which of the movements reflects this scenario? Real GDP per worker Physical Capital per worker O B to C O D to C O A to C O E to C
Which of the following options listed below do economists count as determinants of economic growth? Select all that apply. Hint: read through all the options provided. O Techriological improvement. Growth in birth rates O Growth in the number of people "Not in the labour force". Growth in human capital. Growth in the interest rate. Growth in the labour force participation rate. O Growth in government spending. Growth in resource efficiency. Growth in physical capital. O Growth in the number of immigrants entering the country. Minimizing taxes. O Growth in imports.