Please explain in detail the right option as well as the wrong OptionsA decrease in the saving rate in a steady-state economy would cause A.an upward shift in the saving per worker curve and an increase in the steady-state capital per worker. B.a downward shift in the saving per worker curve and a decrease in the steady-state capital per worker. C.a leftward movement along with the saving per worker curve and a decrease in the steady-state capital per worker. D.a rightward movement along with the saving per worker curve and an increase in the steady-state capital per worker.

Answer - Need to find- Correct option Given in the question- A decrease in the saving rate in a…

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ENGR.ECONOMIC ANALYSIS

14th Edition

ISBN:9780190931919

Author:NEWNAN

Publisher:NEWNAN

Chapter1: Making Economics Decisions

Section: Chapter Questions

Problem 1QTC

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How much the economy can produce at its natural rate of output depends on a. technology b. the quantity of available natural resources c. the productivity of labor d. the stock of available capital e. all the above
None
The long-run effects of an increase in the saving rate include...? a. a higher level of productivity. b. a higher growth rate of productivity. c. a higher growth rate of income. d. All of the above are correct.
Suppose a country’s total output is growing 10 percent per year, but its population is growing 11 percent per year. What will happen to living standards? a. Rise. b. Fall. c. Remain the same.
Investment in capital is important because it A-decreases productivity. B-leads to lower taxes. C-increases productivity. D-leads to higher taxes.
Explain the concept of investment opportunity set in more than 250 words.
41. Assume that a country's per-worker production is y=1.5k3/4, where y is output per worker and k is capital per worker. Assume also that 10 percent of capital depreciates per year and there is no population growth or technological change. a. If the saving rate (s) is 0.15, what are capital per worker, production per worker, and consumption per worker in the steady state? b. Solve for steady-state capital per worker, production per worker, and consumption per worker with s-0.3. c. Solve for steady-state capital per worker, production per worker, and consumption per worker with s-0.45. d. Is it possible to save too much? Why?
Question 1Some data at first might seem puzzling: The share of GDP devoted to investment was similar for Country liberty and Country Techno from 1970 - 2001. However, during these same years Country Techno had a 6 percent growth rate of average annual income per person, while Country liberty had only a 2 percent growth rate. If the saving rates were the same, why were the growth rates so different?
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1. In the Malthusian model, suppose that the quantity of land increases. Using diagrams, determine what effects this has in the long-run steady state and explain your results.
Assuming an economy is at steady state, with the use of an appropriate diagram withdescriptions illustrate the impact of a reduction in the saving rate on capital perworker and output per worker.
1. Assume individual's utility flow function takes form: u(c) = log(c), and the production function takes form: Y(t) = AK(t) + BL(t). Describe the physical capital accumnlation equation and obtain the GDP growth rate in the following economy: (a) RCK economy (b) OLG economy

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	A.	an upward shift in the saving per worker curve and an increase in the steady-state capital per worker.
	B.	a downward shift in the saving per worker curve and a decrease in the steady-state capital per worker.
	C.	a leftward movement along with the saving per worker curve and a decrease in the steady-state capital per worker.
	D.	a rightward movement along with the saving per worker curve and an increase in the steady-state capital per worker.