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Macroeconomics 12th Edition by Rudiger Dornbusch ,Stanley Fischer,Richard Startz
Edition 12ISBN: 978-1259070969Macroeconomics 12th Edition by Rudiger Dornbusch ,Stanley Fischer,Richard Startz
Edition 12ISBN: 978-1259070969 Exercise 1
Consider an economy whose production function is
with A = 4 K / N. Suppose that it has a saving rate of.1, a population growth rate of.02, and an average depreciation rate of.03 and that
a. Reduce the production function to the form y = ak. What is a
b. What are the growth rates of output and capital in this model
c. Interpret a. What are we really saying when we assume that the labor-augmenting technology, A , is proportional to the level of capital per worker
d. What makes this an endogenous growth model
with A = 4 K / N. Suppose that it has a saving rate of.1, a population growth rate of.02, and an average depreciation rate of.03 and that a. Reduce the production function to the form y = ak. What is a
b. What are the growth rates of output and capital in this model
c. Interpret a. What are we really saying when we assume that the labor-augmenting technology, A , is proportional to the level of capital per worker
d. What makes this an endogenous growth model
Explanation
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There is an economy with a given product...
Macroeconomics 12th Edition by Rudiger Dornbusch ,Stanley Fischer,Richard Startz
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