Imagine that one of the long-run effects of the wars currently going on around the world is to make people more conservative such that their savings rates increase. A. Using the Solow model, describe what the short and long-run impacts of this change are? Does consumption go up or down in the short and long-runs? What happens to the capital stock per person? What happens to the growth rate of output per capita in the short and long- runs? B. Now assume that an additional effect of these wars is that the popu- lation growth rate also increases. How does this impact your previous answer?

Imagine that one of the long-run effects of the wars currently going on around the world is to make people more conservative such that their savings rates increase. A. Using the Solow model, describe what the short and long-run impacts of this change are? Does consumption go up or down in the short and long-runs? What happens to the capital stock per person? What happens to the growth rate of output per capita in the short and long- runs? B. Now assume that an additional effect of these wars is that the popu- lation growth rate also increases. How does this impact your previous answer?

Principles of Economics 2e

2nd Edition

ISBN:9781947172364

Author:Steven A. Greenlaw; David Shapiro

Publisher:Steven A. Greenlaw; David Shapiro

Chapter1: Welcome To Economics!

Section: Chapter Questions

Problem 6SCQ: Suppose we extend the circular flow model to add imports and exports. Copy the circular flow diagram...

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Did the COVID-19 pandemic create new globalization opportunities for growth in yourCaribbean territory? YES/NOBased on your answer, write an answer that identifies those accepts that contribute to thegrowth, expansion and advancement of your local economy. On the contrary, if you do notbelieve that new opportunities were created, write an answer that identifies those acceptsthat negatively contributed to the negative growth, contraction and deceleration of our localeconomyPlease explain
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