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gure 5.1: Solow Diagram NVESTMENT, EPRECIATION dk

gure 5.1: Solow Diagram NVESTMENT, EPRECIATION dk

ENGR.ECONOMIC ANALYSIS
ENGR.ECONOMIC ANALYSIS
14th Edition
ISBN:9780190931919
Author:NEWNAN
Publisher:NEWNAN
Chapter1: Making Economics Decisions
Section: Chapter Questions
Problem 1QTC
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Please help me answer 11-14

Figure 5.1: Solow Diagram INVESTMENT. DEPRECIATION a. decrease; grow b. increase; grow C. stay constant; shrink K₂ K3 CAPITAL, K 11. In Figure 5.1, if the economy begins with the initial capital stock at K₁, the capital stock will the economy will a. b. K₁ dk 12. In the equation Y = F(K, L) =ĀK¹/3L2/3, the "bar" over the A means that it is a: parameter that is endogenous. variable that is fixed but not exogenous. I= SY Δε the change in k over time, Ak, is equal to: e a. Ak¹/3 - dk b. Ak¹/3+g-dk c. SĀK¹/3+ (9- d)k C. variable that is exogenous, either constant or varying over time. d. variable that is endogenous. e. parameter that is fixed and endogenous. a. b. C. d. decrease; shrink e. stay constant; grow Y = 6 Y = 14 3. Consider a Solow growth model with production function Y = F(K, L) =ĀK1/3 (eL) 2/3, where e is an exogenous variable that measures the efficiency of an hour of work. Suppose L is constant but e grows at the constant rate >0. We denote k = K/(eL) the capital stock per effect unit of labor. Using that k Ak AK K 14. If the production function is given by Y = AK¹/³L2/3 and à = 1 and K = L = 8, total output equals: Y = 2 d. Y=8 e. d. SÃk¹/3 (+ d)k Ak¹/3 - (g- d)k e. and None of these answers is correct
Transcribed Image Text:Figure 5.1: Solow Diagram INVESTMENT. DEPRECIATION a. decrease; grow b. increase; grow C. stay constant; shrink K₂ K3 CAPITAL, K 11. In Figure 5.1, if the economy begins with the initial capital stock at K₁, the capital stock will the economy will a. b. K₁ dk 12. In the equation Y = F(K, L) =ĀK¹/3L2/3, the "bar" over the A means that it is a: parameter that is endogenous. variable that is fixed but not exogenous. I= SY Δε the change in k over time, Ak, is equal to: e a. Ak¹/3 - dk b. Ak¹/3+g-dk c. SĀK¹/3+ (9- d)k C. variable that is exogenous, either constant or varying over time. d. variable that is endogenous. e. parameter that is fixed and endogenous. a. b. C. d. decrease; shrink e. stay constant; grow Y = 6 Y = 14 3. Consider a Solow growth model with production function Y = F(K, L) =ĀK1/3 (eL) 2/3, where e is an exogenous variable that measures the efficiency of an hour of work. Suppose L is constant but e grows at the constant rate >0. We denote k = K/(eL) the capital stock per effect unit of labor. Using that k Ak AK K 14. If the production function is given by Y = AK¹/³L2/3 and à = 1 and K = L = 8, total output equals: Y = 2 d. Y=8 e. d. SÃk¹/3 (+ d)k Ak¹/3 - (g- d)k e. and None of these answers is correct
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