EBK MACROECONOMICS
7th Edition
ISBN: 8220106812686
Author: O'Brien
Publisher: PEARSON
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Chapter 11, Problem 11.4.8PA
To determine
The reason for the higher growth of large companies than smaller companies in Mexico.
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3. The following information has been discovered about the economy of Errachidia. The
country's productivity curve is
Capital
Real GDP
10
3.8
20
5.7
30
7.13
40
8.31
50
9.35
60
10.29
70
11.14
80
11.94
1) Draw the production function for Ertachidia
2) Explain the reason for the shape of the graph
Ac
Acc
Productivity often rises during economic expansions and falls during economic recessions. Can you think of reasons why? Briefly explain. (Hint: Remember that the level of productivity involves both levels of output and levels of labor input.)
Discuss the following statement:
“Those who argue that technological progress does not reduce employment should take a look at agriculture. At the start of the last century, there were more than 11 million farm workers. Today, there are fewer than 1 million. If all sectors start having the productivity growth that took place in agriculture during the 20th century, no one will be employed a century from now.”
Chapter 11 Solutions
EBK MACROECONOMICS
Ch. 11 - Prob. 11.1.1RQCh. 11 - Prob. 11.1.2RQCh. 11 - Prob. 11.1.3PACh. 11 - Prob. 11.1.4PACh. 11 - Prob. 11.1.5PACh. 11 - Prob. 11.1.6PACh. 11 - Prob. 11.1.7PACh. 11 - Prob. 11.1.8PACh. 11 - Prob. 11.2.1RQCh. 11 - Prob. 11.2.2RQ
Ch. 11 - Prob. 11.2.3RQCh. 11 - Prob. 11.2.4RQCh. 11 - Prob. 11.2.5PACh. 11 - Prob. 11.2.6PACh. 11 - Prob. 11.2.7PACh. 11 - Prob. 11.2.8PACh. 11 - Prob. 11.2.10PACh. 11 - Prob. 11.2.11PACh. 11 - Prob. 11.2.12PACh. 11 - Prob. 11.3.1RQCh. 11 - Prob. 11.3.2RQCh. 11 - Prob. 11.3.3PACh. 11 - Prob. 11.3.4PACh. 11 - Prob. 11.3.5PACh. 11 - Prob. 11.3.6PACh. 11 - Prob. 11.4.1RQCh. 11 - Prob. 11.4.2RQCh. 11 - Prob. 11.4.3RQCh. 11 - Prob. 11.4.4PACh. 11 - Prob. 11.4.5PACh. 11 - Prob. 11.4.6PACh. 11 - Prob. 11.4.8PACh. 11 - Prob. 11.4.9PACh. 11 - Prob. 11.4.10PACh. 11 - Prob. 11.4.11PACh. 11 - Prob. 11.4.12PACh. 11 - Prob. 11.5.1RQCh. 11 - Prob. 11.5.2RQCh. 11 - Prob. 11.5.3PACh. 11 - Prob. 11.5.4PACh. 11 - Prob. 11.5.5PACh. 11 - Prob. 11.5.6PACh. 11 - Prob. 11.5.7PACh. 11 - Prob. 11.5.8PACh. 11 - Prob. 11.5.9PACh. 11 - Prob. 11.1RDECh. 11 - Prob. 11.2RDECh. 11 - Prob. 11.3RDE
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- Typed plaza Asaparrow_forwardBriefly provide the relationship between economic growth (GDP growth), high/low unemployment, high/low wages, and the way they impact one another.arrow_forward2.4 Economic growth in the long run. Another theory explaining economic growth is the Endogenous Growth Theory. Suppose a country having the following parameters: Production function: Y = AK Saving rate: 5 Depreciation rate of capital: & What is the condition for economic growth. according to this theory?arrow_forward
- 10arrow_forwardTechnological progress, agriculture and employment: Discuss the following statement: “Those who argue that technological progress does not reduce employment should take a look at agriculture. At the start of the last century, there were more than 11 million farm workers. Today, there are fewer than 1 million. If all sectors start having the productivity growth that took place in agriculture during the 20th century, no one will be employed a century from now.”arrow_forwardIn its recent report, The Conference Boards Global Economic Outlook 2015, updated November 2014 (http://www.conference-board.org/data/ globaloutlook.cfm), projects Chinas growth between 2015 and 2019 to be about 5.5%. International Business Times (http//www.ibtimes.com/us-exports-china-have rown-294-over-past-decade- 1338693) reports that China is the United States third largest export market, with exports to China growing 294 over the last ten years. Explain what impact China has on the U.S. economy.arrow_forward
- Say that the average worker in Canada has a productivity level of 30 per hour while the average worker in the United Kingdom has a productivity level of 25 per hour (both measured in U.S. dollars). Over the next five years, say that worker productivity in Canada grows at 1 per year while worker productivity in the UK grows 3 per year. After five years, whiz) will have the higher productivity level, and by how much?arrow_forward6.5 Exercises Exercise 6.1 (Technological Progress and Long-Run Growth). Consider a Solow economy with population growth and technological progress. The evolution of the capital stock per efficiency unit of labor, denoted k1, is given by the law of motion (1+n)(1+ g)kt+1 = (1 – 8)kt +of(kt). Capital per efficiency unit of labor is defined as k, = Kt/(LEt), where Kt denotes the stock of physical capital, L, denotes population, and E is a tech- nological factor. Population grows at the rate n and the technological factor grows at the rate g. The subscript t denotes time, measured in years. The parameters d E (0, 1) and o > 0 denote, respectively, the depreciation rate of capital and the savings rate. The function f(k;) represents the produc- tion technology. Specifically, let Y, denote output and yt = Yt/(LEt) denote output per efficiency unit of labor. Then yt = f(kt). Assume that f(kt) = /k. 1. Find the steady-state stock of capital per efficiency unit of labor, de- noted k*, as a…arrow_forward2. Suppose the table represents the production function of both Mexico and Spain. Use the following information to answer the next question. K = Capital (trillions) Y = Output (trillions) Country L = Population (millions) Mexico Spain 105 45 0.18 0.74 1.0 1.7 0arrow_forward
- 1. (This is problem 3, page 238 of the textbook.) For a particular economy, the following capital input K and labor input N were reported in four different years: Year 1 234 4 K 200 250 250 300 N 1000 1000 1250 1200 The production function in this economy is Y=K0.3 Nº.7, where Y is total output. a. Find total output, the capital-labor ratio, and output per worker in each year. Compare year 1 with year 3 and year 2 with year 4. Can this production function be written in per-worker form? If so, write algebraically the per- worker form of the production function. b. Repeat Part (a) but assume now that the production function is Y = Kº.3 Nº.8arrow_forwardWith the following excerpts, how could economic growth affect the value of a country’s importsarrow_forwardThe following data give real GDP, Y, capital, K, and labor, N, for the U.S. economy in various years. Year Y K N 1970 3460 4400 75 1980 5196 6000 104 1990 7123 7600 119 2000 10,044 10,400 139 2010 11,606 11,600 152 2020 14,961 13,500 173 Assume that the production function is Y= AKO.3 NO.7 Calculate the growth rate of total factor productivity in each decade. Between 1970 and 1980, U.S. total factor productivity grew by 8.82 %. (Enter your answer as a percentage rounded to one decimal place.) Between 1980 and 1990, U.S. total factor productivity grew by ☐ %. (Enter your answer as a percentage rounded to one decimal place.)arrow_forward
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