The economy is described by the production function: Y=AK 0.4N0.6. In year 2500, GDP is 10,000, capital stock is 200 and labor is 500. If TFP grows by 5% in year 2501, then GDP grows by ... OA. 2% OB. 3% OC. 4% DEL
The economy is described by the production function: Y=AK 0.4N0.6. In year 2500, GDP is 10,000, capital stock is 200 and labor is 500. If TFP grows by 5% in year 2501, then GDP grows by ... OA. 2% OB. 3% OC. 4% DEL
Chapter1: Making Economics Decisions
Section: Chapter Questions
Problem 1QTC
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![The economy is described by the production function: Y=AK 0.4Nº.6. In year 2500, GDP is 10,000, capital stock is 200 and labor is 500. If
TFP grows by 5% in year 2501, then GDP grows by ...
A. 2%
B. 3%
OC. 4%
D.5%](/v2/_next/image?url=https%3A%2F%2Fcontent.bartleby.com%2Fqna-images%2Fquestion%2F6051ad74-8d84-4162-ae23-e6855e602103%2Fb140cbda-c391-4613-a967-9fb824094f38%2Fl9hqapn_processed.png&w=3840&q=75)
Transcribed Image Text:The economy is described by the production function: Y=AK 0.4Nº.6. In year 2500, GDP is 10,000, capital stock is 200 and labor is 500. If
TFP grows by 5% in year 2501, then GDP grows by ...
A. 2%
B. 3%
OC. 4%
D.5%
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