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(a) Consider the following data on the fictional countries of Sylvania and Freedonia. The production function is y = Akah¹-a, where a = 0.5. Sylvania Freedonia Output per Worker, y 100 200 Physical Capital per Worker, k 100 100 Human Capital per Worker, h 25 64 (b) Calculate the level of productivity, A, in each country. (c) (d) Calculate the countries' relative levels of output if all differences in output were the result of productivity. Calculate the countries' relative levels of output if all differences in output were the result of factor accumulation.

(a) Consider the following data on the fictional countries of Sylvania and Freedonia. The production function is y = Akah¹-a, where a = 0.5. Sylvania Freedonia Output per Worker, y 100 200 Physical Capital per Worker, k 100 100 Human Capital per Worker, h 25 64 (b) Calculate the level of productivity, A, in each country. (c) (d) Calculate the countries' relative levels of output if all differences in output were the result of productivity. Calculate the countries' relative levels of output if all differences in output were the result of factor accumulation.

ENGR.ECONOMIC ANALYSIS
ENGR.ECONOMIC ANALYSIS
14th Edition
ISBN:9780190931919
Author:NEWNAN
Publisher:NEWNAN
Chapter1: Making Economics Decisions
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(a) Consider the following data on the fictional countries of Sylvania and Freedonia. The production function is y = Akah¹-a, where a = 0.5. Sylvania Freedonia Output per Worker, y 100 200 Physical Capital per Worker, k 100 100 Human Capital per Worker, h 25 64 (b) Calculate the level of productivity, A, in each country. (c) (d) Calculate the countries' relative levels of output if all differences in output were the result of productivity. Calculate the countries' relative levels of output if all differences in output were the result of factor accumulation.
Transcribed Image Text:(a) Consider the following data on the fictional countries of Sylvania and Freedonia. The production function is y = Akah¹-a, where a = 0.5. Sylvania Freedonia Output per Worker, y 100 200 Physical Capital per Worker, k 100 100 Human Capital per Worker, h 25 64 (b) Calculate the level of productivity, A, in each country. (c) (d) Calculate the countries' relative levels of output if all differences in output were the result of productivity. Calculate the countries' relative levels of output if all differences in output were the result of factor accumulation.
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