1 assume an economy has a production function ofy, Macroeconomics

+44 141 628 6080
[email protected]

1 assume an economy has a production function ofy

1. Assume an economy has a production function of:

Y = AK^.35L^.65 with: A = 100, K = 1,000 and L = 400. There is no labor force growth and technology remains constant.

(a) Assume that the capital stock in this economy depreciates at 10%/year and the savings rate out of GDP is 40%. What would be the steady state level of y, c, s, k?

(b) Derive the golden rule savings rate for this economy. (Hint it will be 35 percent) What would be the new level of steady state y, c, s, k if the economy moved to the golden rule savings rate?

View Complete Question

Request for Solution File

Ask an Expert for Answer!!

Macroeconomics: 1 assume an economy has a production function ofy

Reference No:- TGS0490271

Expected delivery within 24 Hours

Have a Question? (oR Write a Review)

Write atleast 100 words!!

Asked Questions

Why you feel unpleasantly hot and sweaty

Working in the yard, you feel unpleasantly hot and sweaty when you come in the house, so you take a shower and begin to feel better.

Discussion about gender stereotyping

Prior to your taking this graduate HR law class you had heard of the term "gender stereotyping," but didn't know much about it.

Identify one antecedent, one behaviour, and one consequence

Sahir is the most active student in your kindergarten class. He tends to be very disruptive when the teacher you work with is teaching the class,

Identify a specific theory of cognitive or moral development

Problem 1: Identify a specific theory of cognitive or moral development, and summarize the major assumptions.

Examine historical literature to the most current period

Examine historical literature to the most current period to see the growth of romanticism and EXISTENTIALISM. any major developments

Provide reasons why working from a person centred

Provide five (5) reasons why working from a person centred, strengths-based positive framework, and providing positive lifestyle strategies can reduce

Discussion about the nature versus nurture

In our readings, we learn more about the nature versus nurture argument. For this discussion, I want you to go in depth a bit more and debate the importance

Request for Solution File

Ask an Expert for Answer!!

Macroeconomics: 1 assume an economy has a production function ofy

Reference No:- TGS0490271

Have a Question? (oR Write a Review)

Recent Questions Asked Macroeconomics

Q : locate 2 peer-reviewed articles that discuss the

Q : q1- treasury bills have a fixed face calue say

Q : write illustration essay - on cause and effect of

Q : you are the chairperson of the federal reserve

Q : 1 assume an economy has a production function ofy

Q : n crime and punishment the characters raskolnikov

Q : using the same production function as in question

Q : assume an economy with an ae curve with a slope

Q : over half of the nations lettuce comes from three