Suppose China has a production function of the form: GDP per worker = Tx (physical capital per worker)0.4 x (human capital per worker)0.6 Using this production function, which of the following statements are true? (Select all that apply) Unlike physical and human capital, technology (T) is not directly measured GDP per worker will increase if the labor force grows Output per worker will grow more if human capital increases by 1% than if physical capital increases by 1% None of the above

Suppose China has a production function of the form: GDP per worker = Tx (physical capital per worker)0.4 x (human capital per worker)0.6 Using this production function, which of the following statements are true? (Select all that apply) Unlike physical and human capital, technology (T) is not directly measured GDP per worker will increase if the labor force grows Output per worker will grow more if human capital increases by 1% than if physical capital increases by 1% None of the above

ENGR.ECONOMIC ANALYSIS

14th Edition

ISBN:9780190931919

Author:NEWNAN

Publisher:NEWNAN

Chapter1: Making Economics Decisions

Section: Chapter Questions

Problem 1QTC

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Assume the production function takes the general form: Y=Z*F (K,L,A)where all marginal products are positive.Which 3 of the following statements are correct?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 populationgrowth 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.d. Growth in output per worker can occur due to rises in z (technology) or rises in K/L (capital intensity), orboth.
5.2
1. Country A and B both have the production functionY = F (K, L) = K ½L ½or Y = K0.5 L0.5 a) What is the per-worker production function, y= f (k)? Please make sure to write specificfunctional form of the per-worker production function. b) Assume that neither country experiences population growth nor technological progressand that 4 percent of capital depreciates each year. Assume further that country A saves 24percent of output each year and country B saves 16 percent of output each year. Using youranswer from part a) and the steady-state condition, find the steady-state level of capital perworker for each country. Then find the steady-state levels of income per worker for eachcountry and steady-state level of consumption per worker for each country.
In class we argued that if people could accumulate human as well as physical capital, the production function would look like the “AK” production function. • (a) If the production function is AK and the savings rate is constant at rate “s”, and the rates of depreciation and populati on growth are δ and n respectively, what would the growth rate of the economy be? • (b) What would be the macroeconomic consequences of decreasing the savings rate in this economy? • (c) What would be the consequences of an increase in fertility in this economy? • (d) Would the consequences of decreasing fertility be UNAMBIGUOUSLY GOOD? • (e) Can human capital grow without bounds? Explain why or why not (make sure you discuss the physical nature of human capital). • (f) What is the growth rate of the economy (in the absence of technological progress) if human capital cannot grow without bounds?
Describe and illustrate in a graph what happened in the economy in the table below if in year 1, capital per hour of labor was 30 and in year 2 it was 40. Capital per hour of labor 10 20 30 40 50 60 70 Real GDP per hour of labor In Year 1 7 13 18 22 25 27 28 In Year 2 9 17 24 30 35 39 42
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 = (g//m)(L) Suppose L = 1 and m = 7, and that initially ga = 0.7. If ga fell to 0.8 the level of output per %3D worker would: fall Impossible to say rise stay the same
Consider a hypothetical small island nation in which the only industry is weaving. The following table displays information about the economy over a two year period. Complete the table by calculating physical capital per worker as well as labor productivity. Hint: Recall that productivity is defined as the amount of goods and services a worker can produce per hour. In this problem, measure productivity as the quantity of goods per hour of labor. Year 2032 2033 Physical Capital Labor Force Physical Capital per Worker Labor Hours (Looms) (Workers) (Looms) (Hours) 120 60 3,000 400 100 3,500 Based on your calculations, productivity from 2032 to 2033. Output Labor Productivity (Tapestries) (Tapestries per hour of labor) Suppose you're in charge of establishing economic policy for this small island country, 21,000 49,000 in physical capital per worker from 2032 to 2033 is associated with Which of the following policies would lead to greater productivity in the weaving industry? Check all…
Suppose you are given the aggregate production function for an economy and the amount of available technology increases for this economy. If labor and capital constant are held constant, increase in technology will causes labor productivity to decrease. True False
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Please answer the following question as soon as possible. Thanks a lot! Imagine we live in a classical world. Suppose that the production function is ? = ?^(1/2)?^(1/2), where L is the amount of labor and K is the amount of capital. The economy has 100 units of labor and 100 units of capital.
The following graph shows a variety of possible production functions (PFs) in an imaginary economy, assuming constant levels of human capital and technology. Because human capital and technology remain unchanged, each of these production functions represents a different level of the capital stock. Fill in the table with the curve that corresponds to each of the capital stock levels described. Levels of Capital Stock This corresponds to which curve? (PF1, PF2, PF3) Highest Middle Lowest Fill in the blank: The slope of the line connecting the origin to point B is __________ (options: flatter, steeper) than the slope of the line connecting the origin to point A, because the slope of such a line is equivalent to ___________ (options: productivity, the marginal physical product of labor, marginal cost).