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Exercise 4.1 (The U.S. Population Slowdown and Income Per Capita). U.S. Population in Selected Years Year Population in millions 1870 1871 2015 2016 40.24 41.10 3. Provide intuition. 321.08 323.30 1. Using the information provided in the table, calculate the population growth rate between 1870 and 1871 and between 2015 and 2016. Denote these two numbers n and n', respectively. 2. Suppose that the depreciation rate is 10 percent per year (8 = 0.1), that the saving rate is 25 percent (o= 0.25), and that the production function is of the Cobb-Douglas form, that is, Y₁ = AKL-a, where Yt, Kt, and Lt denote, respectively, output, the stock of capital, and population in period t, and a and A are constant parameters. Assume that a = 0.3. Let y* and y*' denote the steady-state output per capita associated with n and n', respectively. Calculate the percentage in- crease in long-run output per capita caused by a permanent fall in the population growth rate from n to n', that is, calculate (y*/y*'-1)× 100.

Exercise 4.1 (The U.S. Population Slowdown and Income Per Capita). U.S. Population in Selected Years Year Population in millions 1870 1871 2015 2016 40.24 41.10 3. Provide intuition. 321.08 323.30 1. Using the information provided in the table, calculate the population growth rate between 1870 and 1871 and between 2015 and 2016. Denote these two numbers n and n', respectively. 2. Suppose that the depreciation rate is 10 percent per year (8 = 0.1), that the saving rate is 25 percent (o= 0.25), and that the production function is of the Cobb-Douglas form, that is, Y₁ = AKL-a, where Yt, Kt, and Lt denote, respectively, output, the stock of capital, and population in period t, and a and A are constant parameters. Assume that a = 0.3. Let y* and y*' denote the steady-state output per capita associated with n and n', respectively. Calculate the percentage in- crease in long-run output per capita caused by a permanent fall in the population growth rate from n to n', that is, calculate (y*/y*'-1)× 100.

ENGR.ECONOMIC ANALYSIS
ENGR.ECONOMIC ANALYSIS
14th Edition
ISBN:9780190931919
Author:NEWNAN
Publisher:NEWNAN
Chapter1: Making Economics Decisions
Section: Chapter Questions
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Give me solution of question 2 and 3 please

Exercise 4.1 (The U.S. Population Slowdown and Income Per Capita). U.S. Population in Selected Years Population in millions 40.24 41.10 321.08 Year 1870 1871 2015 2016 323.30 1. Using the information provided in the table, calculate the population growth rate between 1870 and 1871 and between 2015 and 2016. Denote these two numbers n and n', respectively. 2. Suppose that the depreciation rate is 10 percent per year (6 = 0.1), that the saving rate is 25 percent (o = 0.25), and that the production function is of the Cobb-Douglas form, that is, Y₁ = AK&L-a, where Yt, Kt, and Lt denote, respectively, output, the stock of capital, and population in period t, and a and A are constant parameters. Assume that a = 0.3. Let y* and y*' denote the steady-state output per capita associated with n and n', respectively. Calculate the percentage in- crease in long-run output per capita caused by a permanent fall in the population growth rate from n to n', that is, calculate (y*/y*' − 1) × 100. 3. Provide intuition.
Transcribed Image Text:Exercise 4.1 (The U.S. Population Slowdown and Income Per Capita). U.S. Population in Selected Years Population in millions 40.24 41.10 321.08 Year 1870 1871 2015 2016 323.30 1. Using the information provided in the table, calculate the population growth rate between 1870 and 1871 and between 2015 and 2016. Denote these two numbers n and n', respectively. 2. Suppose that the depreciation rate is 10 percent per year (6 = 0.1), that the saving rate is 25 percent (o = 0.25), and that the production function is of the Cobb-Douglas form, that is, Y₁ = AK&L-a, where Yt, Kt, and Lt denote, respectively, output, the stock of capital, and population in period t, and a and A are constant parameters. Assume that a = 0.3. Let y* and y*' denote the steady-state output per capita associated with n and n', respectively. Calculate the percentage in- crease in long-run output per capita caused by a permanent fall in the population growth rate from n to n', that is, calculate (y*/y*' − 1) × 100. 3. Provide intuition.
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