Assume the production function takes the general form (as in lecture notes) Y=zxF(K,L, A) where all marginal products are positive. Which 3 of the following statements are correct? Select one or more: a. If A is fixed, then population growth acts as a drag on growth of output per person. b. If A is fixed, then population growth acts as a drag on growth, and so Malthus was correct that population growth will always reverse the impact of technological improvements. c. Both rises in z and rises in K/L (capital intensity) will boost output per worker.

Assume the production function takes the general form (as in lecture notes) Y=zxF(K,L, A) where all marginal products are positive. Which 3 of the following statements are correct? Select one or more: a. If A is fixed, then population growth acts as a drag on growth of output per person. b. If A is fixed, then population growth acts as a drag on growth, and so Malthus was correct that population growth will always reverse the impact of technological improvements. c. Both rises in z and rises in K/L (capital intensity) will boost output per worker.

Microeconomic Theory

12th Edition

ISBN:9781337517942

Author:NICHOLSON

Publisher:NICHOLSON

Chapter9: Production Functions

Section: Chapter Questions

Problem 9.2P

See similar textbooks

Similar questions

The graph below represents per-worker production functions for the same country. Answer the following questions using this graph. Which 1 concept explains that the area between B and C has a flatter slope than the area between A and B? Answer: Law of Diminishing Marginal Returns What has to happen for a country to move from point E to B to D? Answer: The movement through which 3 points (out of 5 given) would indicate the largest increase in productivity? Answer:
In Wonderland production per worker (y) depends on capital per worker (3) such the y=10√k. Every year 15% of the capital stock depreciates, while workers in Wonderland save 10% of their income. Every year the population grows at as e of 3% (d) How might Wonderland and Neverland achieve economic growth in the long run?
Consider an economy with a Cobb-Douglas production function with α = 1/3 that begins in steady state with a growth rate of technological progress of g of 2 percent. Consider what happens when g increases to 3 percent. (a) What is the growth rate of output per worker before the change? What happens to this growth rate in the long run? (b) Perform a growth accounting exercise for the economy, decomposing the growth rate in output per capita into components contributed by capital per capita growth and technology growth. What is the contribution of the change in g to output per capita growth according to this formula? (c) In what sense is the growth accounting result in part b producing a misleading picture of this experiment? Explain why this is the case.
1. Consider a Cobb-Douglas production function that features capital-augmenting technology: Y(t) = [A(t) K(t)]aL(t)¹-a. Assume that technology A(t) grows at rate u: A(t) = μA(t). Show that the economy converges to a balanced growth path, and find the growth rates of Y and K on the balanced growth path. 2. Let the production function be Y(t) = J(t)aL(t)1-a, where J(t) is the effective capital stock. The dynamics of J(t) are given by j (t) = sA(t)Y (t) — 8(t). The presence of the A(t) term in this expression means that the productivity of investment at t depends on the technology at t. Show that the economy converges to a balanced growth path. What are the growth rates of Y and J on the balanced growth path? dy* S as y* 3. Find the elasticity of output on the balanced growth path with respect to s: Consider a Solow economy that is on its balanced growth path. Assume for simplicity that there is no technological progress. Now suppose that the rate of population growth falls. 1. What…
Is the following statement true, false, or uncertain? A one-time increase in the amounts of capital and labor that leaves capital per person unchanged has no effects on the levels of output or output per person in the short run or in the steady state.
[The following scenario applies to the next two questions.] An economy has a Cobb-Douglas production function: Y = AK L(1-a). A is the technology level, K is capital; L is labor; and Y is income. ● In 20X1, the technology level A is 139, capital K = 245, labor L = 458, income Y = 8,155 In 20X2, the technology level A is 144.96, capital K = 259.26, labor L = 474.12, income Y = 8,945.71 In 20X3, the technology level A is 152.02, capital K = 273.31, labor L = 489.20 Question 1.6: Elasticity of income with respect to labor What is the elasticity of income with respect to labor? A. 18% B. 20% C. 22% D. 24% E. 26% Question 1.7: Income What is income in 20X3? A. 9,240.34 B. 9,535.25 C. 9,830.15 D. 10,125.06 E. 10,419.96
Suppose the per-worker production function is: y = A(1-ga) Where ga is the fraction of all workers that produce technologies. Further, suppose the growth of technology is given by the following equation growth of A = (ga/m)(L) Suppose L = 1 and m = 7, and that initially ga = 0.7. If g, fell to 0.8 the level of output per worker would: Impossible to say fall stay the same O rise
Please see attached image.
Could you show me the solution for question part b)
The production function for an economy can be expressed as Y= F(K,L), where Y is real GDP, K is the quantity of capital in the economy, and L is the quantity of labor in the economy. If Y = K0.5 L0.5, what is real GDP if the quantity of capital is 900 and the quantity of labor is а. 400? b. What is/are the endogenous variable(s) in this model? What is/are the exogenous variable(s) in this model? с.
Hand written solutions are strictly prohibited
Could I have the second questions answered as well: For the production function Y = K1/3L2/3 (a) find the function for output per capita (b) What is the growth rate of per capita for this function in terms of the growth rate of K, gK, and the growth rate of L, n. Thanks!