The typical Australian works less than 40hours per week today and worked 49 hoursper week in 1920. Does this fact make theeconomic wellbeing of Australians todayversus 1920 higher or lower than indicated bythe difference in real GDP per capita todayversus 1920? Explain.А.The increase in real GDP per capita between1920 and today overstates the change inwellbeing because the value of leisure is notincluded in GDP.В.The increase in real GDP per capita between1920 and today understates the change inwellbeing because the value of leisure is notincluded in GDPC.The decrease in real GDP per capita between1920 and today understates the change inwellbeing because the value of leisure is notincluded in GDP.D.The decrease in real GDP per capita between1920 and today overstates the change inwellbeing because the value of leisure is notincluded in GDP.

GDP per capita is one of the most used measures to measure the average standard of living in an…

Answered: The typical Australian works less than…

ENGR.ECONOMIC ANALYSIS

14th Edition

ISBN:9780190931919

Author:NEWNAN

Publisher:NEWNAN

Chapter1: Making Economics Decisions

Section: Chapter Questions

Problem 1QTC

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2. Start from the income dynamics equation on slide 45: a () * (v) ²-a Yt+1 = (a) Show graphically that the economy converges to a stable steady-state level of income per capita. (b) Show mathematically that the steady-state level of income per capita is given by y = p/y. (c) Explain why income per capita depends positively on the cost of raising children (p), and negatively on the preference for children (Y). (d) Why is population density, not income per capita, a good measure of technological advancement in Malthusian economies?
Suppose, a country X has a GDP level of 4, 50,000 and a growth rate of 10% in 2007(calculated at the end of the fiscal year 2007). The experts predict that the growth ofthe economy of Country X will gradually slowdown in the coming years. Moreprecisely, they foresee the following growth rates for the future:2007 – 2010 = 10%2010 – 2013 = 9%2013 – 2016 = 7.5%2016 – 2019 = 5%2019 – on = 1% Hint: The list above should be read as saying that, for instance, the growth rate fromthe end of the fiscal year 2007 until the end of 2010 will be 10 %, then from the end of2010 until the end of 2013 it will be 9% and so on. Assuming that the predictions of the experts listed above are accurate, when in thefuture will Country X’s GDP double compared to the GDP level of 2007? Consider now the more optimistic scenario in which the economy does not slow downand the current growth rate of 10% remains constant in the coming years. How longwill it take for the GDP level to double in this scenario? Express…
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Suppose Country A currently has more output and capital than Country B. However, Country A has no technological growth while Country B has persistent technological growth. Assume that the two countries are similar in all other variables. According to the Solow growth model with technological progress, we can expect that: O a. At some future point, Country B will have a higher income per capita. O b. In the steady state, Country B will reach the same income per capita as Country A. All the other statements are false. c. O d. Since they have different steady states, the growth of output per effective worker in both countries will have different rates.
2: One consistent pattern of economic development for most rich countries is that the share of their labor force in agriculture and the share of their GDP from agriculture steadily declined as their total GDP per capita increased. Developing countries today should infer from this pattern that: [Select one] They should try to reduce the number of workers in agriculture in order to grow their economy. They should favor and focus primarily on promoting non-agricultural sectors since they are the most important sectors in developed countries. Both a and b. None of the above.
Solo growth model questions 1.) a. In a Solow growth model that is expressed in per capita terms, what happens to the marginal product of capital as an economy's capital/labor ratio increases? b. In a Solow growth model that is expressed in per capita terms, when an economy is in its steady state, what do you expect to happen to the capital-labor ratio? c. In a Solow growth model that is expressed in per capita terms, what happens to the capital/labor ratio when the savings rate rises? d.In a Solow growth model that is expressed in per capita terms, what happens to the capital/labor ratio when economywide productivity (this is our "A" variable) rises?
List the determinants of productivity. • List three policies that attempt to raise living standards by increasing one of the determinants of productivity.
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3. The following table provides data on output per worker, physical capital per worker, and human capital per worker, all relative to the United States. For each of the three countries listed, calculate factor accumulation and productivity relative to the United States. In which country does factor accumulation play the largest role in explaining income relative to the United States? In which country does productivity play the largest role? Country Output per Worker, y Physical Capital per Human Capital per Worker, k Worker, h Netherlands 0.87 0.81 0.94 Paraguay 0.097 0.094 0.80 Pakistan 0.092 0.067 0.65

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