7. There are large global inequalities in the amount of capital different countries have. Part of that is a result of choices by multinational businesses in where to build their factories. Should an American business like Ford build its next factory in the United States or in another country like Ghana? Many considerations go into this decision, but one of the most important ones is how much extra output the business would generate if it located an additional unit in the United States as opposed to India or another country. For these question assume that all countries have the same aggregate production function: Y = A x VK x Vī but that countries vary in their capital stocks, labor forces, and TFP. X. Many people argue that all countries have access to the same technology. They argue that for the most part most ideas are on the internet which can be accessed from anywhere. So, for now, assume A = 1 in all countries. country K K/L ratio U.S. 691 158.2 4.37 Ghana 4.21 13.2 0.319 Calculate the MPK for the two countries. Based on this model where would you get the best return on your investment? a. U.S., the capital-rich country b. Ghana, the capital-poor country C. same in both

7. There are large global inequalities in the amount of capital different countries have. Part of that is a result of choices by multinational businesses in where to build their factories. Should an American business like Ford build its next factory in the United States or in another country like Ghana? Many considerations go into this decision, but one of the most important ones is how much extra output the business would generate if it located an additional unit in the United States as opposed to India or another country. For these question assume that all countries have the same aggregate production function: Y = A x VK x Vī but that countries vary in their capital stocks, labor forces, and TFP. X. Many people argue that all countries have access to the same technology. They argue that for the most part most ideas are on the internet which can be accessed from anywhere. So, for now, assume A = 1 in all countries. country K K/L ratio U.S. 691 158.2 4.37 Ghana 4.21 13.2 0.319 Calculate the MPK for the two countries. Based on this model where would you get the best return on your investment? a. U.S., the capital-rich country b. Ghana, the capital-poor country C. same in both

ENGR.ECONOMIC ANALYSIS

14th Edition

ISBN:9780190931919

Author:NEWNAN

Publisher:NEWNAN

Chapter1: Making Economics Decisions

Section: Chapter Questions

Problem 1QTC

See similar textbooks

Similar questions

31) Given the narrow interpretation of technology, technology will include which of the following? A) how well firms are run B) the organization and sophistication of markets C) the political environment D) none of the above 32) Suppose there are two countries that are identical with the following exception. The saving rate in country A is greater than the saving rate in country B. Given this information, we know that in the long run A) the growth rate of output per capita will be greater in B than in A. B) the growth rate of output per capita will be greater in A than in B. C) the capital-labor ratios (K/N) will be the same in both countries. D) the growth rate of output per capita will be the same in both countries. 33) Suppose there are two countries that are identical with the following exception. The saving rate in country A is greater than the saving rate in country B. Given this information, we know that in the long run A) the capital-labor ratio…
What are the sources of capital formation ?Explain ? (Subject:Economic Development of Pakistan)
(5 points) Suppose that the marginal product of capital satisfies the following condition: lim fr = A > (8 + n)/s. 00 L Show this model in the context of the above Solow growth model. What does this imply about the existence of a steady state? Will growth in per-capita GDP be continual?
Economics Suppose output per worker in the US is four times (4.0) output per worker in China. Suppose capital per worker in the US is twice that of China. You should assume that the share of capital in income is 40 percent for both countries. Total factor productivity (A) for the U.S is. A)Four times higher (4.0) than China B)U.S TFP is beľow China. C)US TFP is twice (2.0) as high. D)U.S TFP is equal to China. EJU.S TFP is 3.2 times higher than China.
Question 2Assume production function is given by:Y= K(1/2) L(1/2)a. Write the production function in per worker terms (y=f(k))b. Assume that the per worker level of capital in the steady state is 4, the depreciation rate is 5% per year, and population growth is 5% per year. Does this economy have “too much” or “too little” capital? How do you know? [Show your work].
The table below shows the GDP of a country measured in trillions of dollars. What is the growth rate of the GDP of this country in 1999? Year 1998 1999 2000 2001 Profit $526.42 $527.10 $533.69 $541.70 O a) -0.02% O b) 0.04% O c) 0.08% O d) 0.13% O e) 0.18% O f) 0.25% g) There is not enough information to tell.
QUESTION 1 1.1 Entrepreneurial activities may be harmful to economic growth in economies that are passing through the early to middle stage of development as many people would be moving from self-employment to waged employment. Critically discuss this statement on the nexus between entrepreneurship and economic growth as per the literature. 1.2 Using Table 5, discuss the study’s findings for the BRICS countries. 1.3 Given the study’s focus on emerging economies, examine the study’s policy implications for the BRICS countries.
Are there key differences between an increase in the capital stock and an improvement in the level of technology?
5
Please no written by hand and graph Consider a small world that consists of two different countries, a developed and a developing country. In both countries, assume that the production function takes the following form: Y = F (K, LE) = K¹/4 (LE) 3/4, where Y is output, K is capital stock, L is total employment and E is labour augmenting technology. (a) Does this production function exhibit constant returns to scale in K and L? Explain. (b) Express the above production function in its intensive form (i.e., output per-effective worker y as a function of capital per effective worker k). (c) Solve for the steady-state value of y as a function of saving rate s, population growth rate n, technological progress g, and capital depreciation rate 6. (d) The developed country has a savings rate of 30% and a population growth rate of 2% per year. Meanwhile, the developing country has a savings rate of 15% and population growth rate of 5% a year. Technology evolves at the rate of 8% and 2% in…
https://learn.bu.edu/bbcswebdav/pid-10102787-dt-content-rid-67051856_1/xid-67051856_1
Two countries, X & Y both have the production function f(k) = k0.5 but X starts with an initial k of 4 while Y starts with initial k of 16. Both of the countries have the same values for these exogeneous variables: s = 0.2, A = 1, depreciation rate = 0.05, n = 0, L0 = 10. As you can see, X starts out with just 25% as much capital as Y. How many periods does it take before X has at least 50% as much capital as Y? (A spreadsheet will help a lot with this)