3. Productivity and growth policies Consider a small island country whose only industry is fishing. The following table shows information about the small economy in two different years. Complete the table by calculating physical capital per worker as well as labour productivity. Hint: Recall that productivity is defined as the amount of goods and services a worker can produce per hour. In this problem, measure productivity as the quantity of goods per hour of labour. Physical Capital Labour Force Physical Capital per Worker Labour Hours Output Labour Productivity Year (Fishing poles) (Workers) (Fishing poles) (Hours) (Fish) (Fish per hour of labour) 2010 300 100 5,000 45,000 2011 480 120 4,200 50,400 Based on your calculations, in physical capital per worker from 2010 to 2011 is associated with in labour productivity from 2010 to 2011. Suppose you're in charge of establishing economic policy for this small island country. Which of the following policies would lead to greater productivity in the fishing industry? Check all that apply. Encouraging saving by allowing workers to set aside a portion of their earnings in tax-free retirement accounts Offering free public education to every worker in the country Sharply increasing the interest rate on student loans to people pursuing advanced degrees in fishing Imposing a tax on fishing poles
3. Productivity and growth policies Consider a small island country whose only industry is fishing. The following table shows information about the small economy in two different years. Complete the table by calculating physical capital per worker as well as labour productivity. Hint: Recall that productivity is defined as the amount of goods and services a worker can produce per hour. In this problem, measure productivity as the quantity of goods per hour of labour. Physical Capital Labour Force Physical Capital per Worker Labour Hours Output Labour Productivity Year (Fishing poles) (Workers) (Fishing poles) (Hours) (Fish) (Fish per hour of labour) 2010 300 100 5,000 45,000 2011 480 120 4,200 50,400 Based on your calculations, in physical capital per worker from 2010 to 2011 is associated with in labour productivity from 2010 to 2011. Suppose you're in charge of establishing economic policy for this small island country. Which of the following policies would lead to greater productivity in the fishing industry? Check all that apply. Encouraging saving by allowing workers to set aside a portion of their earnings in tax-free retirement accounts Offering free public education to every worker in the country Sharply increasing the interest rate on student loans to people pursuing advanced degrees in fishing Imposing a tax on fishing poles
Chapter1: Making Economics Decisions
Section: Chapter Questions
Problem 1QTC
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Question
Consider a small island country whose only industry is fishing. The following table shows information about the small economy in two different years.
Complete the table by calculating physical capital per worker as well as labour productivity.
Hint: Recall that productivity is defined as the amount of goods and services a worker can produce per hour. In this problem, measure productivity as the quantity of goods per hour of labour.
NOTE: both drop down questions choices are (an increase or, decrease)
Transcribed Image Text:3. Productivity and growth policies
Consider a small island country whose only industry is fishing. The following table shows information about the small economy in two different years.
Complete the table by calculating physical capital per worker as well as labour productivity.
Hint: Recall that productivity is defined as the amount of goods and services a worker can produce per hour. In this problem, measure productivity as
the quantity of goods per hour of labour.
Physical Capital Labour Force Physical Capital per Worker Labour Hours Output
Labour Productivity
Year
(Fishing poles)
(Workers)
(Fishing poles)
(Hours)
(Fish) (Fish per hour of labour)
2010
300
100
5,000
45,000
2011
480
120
4,200
50,400
Based on your calculations,
in physical capital per worker from 2010 to 2011 is associated with
in labour
productivity from 2010 to 2011.
Suppose you're in charge of establishing economic policy for this small island country.
Which of the following policies would lead to greater productivity in the fishing industry? Check all that apply.
Encouraging saving by allowing workers to set aside a portion of their earnings in tax-free retirement accounts
Offering free public education to every worker in the country
O Sharply increasing the interest rate on student loans to people pursuing advanced degrees in fishing
O Imposing a tax on fishing poles
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