Answer the Following Intermediate Macroeconomics: (Thank you!) 1) Two countries, Highland and Lowland, are described by...
Answer the Following Intermediate Macroeconomics: (Thank you!)
1) Two countries, Highland and Lowland, are described by the solow model without technological progess. They have the same Cobb-Douglas production function given as Y=F(K,L)=K(alpha)L(1-alpha), but with different quantities of capital and labor. Highland saves 32 percent of its income, while Lowland saves 8 percent. Highland has a population growth of 1 percent per year, while lowland has a population growth of 5 percent. Capital depreciates in highland at a rate of 5 percent per year, but in lowland, capital depreciates only 1 percent per year.
a. What is the per worker production function available to both countries?
b. Solve for the ratio of Highland steady-state income per worker to Lowlands steady state income per worker.
c. If the Coubb-Douglass parameter (α) takes the conventional value of about 1/3 in both countries, how much higher should income per worker be in Highland compared to Lowland?
d. Income per worker in Highland is actually 16 times income per worker in Lowland. Can you explain this fact by changing the value of the parameter α? what must it be? can you think any way of justifying such a value for the parameter?
e. How els might you explain the large difference in income between Highland and Lowland?
F. What sets of policies would you recommend the government of Lowland to undertake in order for their income to increase to a level closer to that of Highland?
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Answer the Following Intermediate Macroeconomics: (Thank
you!)
1) Two countries, Highland and Lowland, are described by...
h different quanti- d saves 32 percent 5. Two countries, Richland and Poorland described by the...
h different quanti- d saves 32 percent 5. Two countries, Richland and Poorland described by the Solow growth model. The the same Cobb-Douglas production functi F(KL) = A KL, but with different ties of capital and labor. Richland saves 32 of its income, while Poorland saves 10 perce Richland has population growth of 1 percent year, while Poorland has population growth of 3 percent. (The numbers in this problem are che sen to be approximately realistic descriptions of rich and...
Two countries, Richland and Poorland, are described by the Solow model. They have the same Cobb-Douglas...
Two countries, Richland and Poorland, are described by the Solow model. They have the same Cobb-Douglas production function F ( K , L ) = A K α L 1 − α , but with different quantities of capital and labor. Richland saves 32% of its income, while Poorland saves 10 percent. Richland has population growth of 1% per year, while Poorland has population growth of 3% per year. (The numbers in this problem are chosen to be approximately realistic...
2. Consider two countries: Mahaliaville and UWIville. Both countries have the same production: Y = K...
2. Consider two countries: Mahaliaville and UWIville. Both countries have the same production: Y = K Neither country experiences population growth nor technological progress and both countries have a depreciation rate of 10%. Ma- haliaville saves 10 percent of ouput each year and UWIville saves 30% of output each year. (a) Find the steady-state levels of capital per worker, income per worker and consumption per worker for each country. (b) If both countries start with a capital stock per worker...
2. Consider two countries: Mahaliaville and UWIville. Both countries have the same production: Y = K...
2. Consider two countries: Mahaliaville and UWIville. Both countries have the same production: Y = K L Neither country experiences population growth nor technological progress and both countries have a depreciation rate of 10%. Ma- haliaville saves 10 percent of ouput each year and UWIville saves 30% of output each year. (a) Find the steady-state levels of capital per worker, income per worker and consumption per worker for each country. (b) If both countries start with a capital stock per...
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Please answer the last person didn't answer all of it. Thank
you!
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3. The amount of education a person receives varies substantially among countries. Suppose you we...
3. The amount of education a person receives varies substantially among countries. Suppose you were to compare a country with a less educated labor force (with labor efficiency E1) and a country with a highly educated labor force (with labor efficiency E 2). Assume that education affects the level but not the growth of the efficiency of labor, that is E1
WRITING MUST BE CLEAR TO READ! 3. Country A and country B both have the production...
WRITING MUST BE CLEAR TO READ!
3. Country A and country B both have the production function Y = F(K, L) = K^(1/3) L ^(2/3). 3a. Does this production function have constant returns to scale? Explain. 3b. What is the per-worker production function, y = f(k)? 3c. Assume that neither country experiences population growth or technological progress and that 20 percent of capital depreciates each year. Assume further that country A saves 10 percent of output each year and country...
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3.) There are two countries, Anihc (country A) and Bapan (country B), with the same production...
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h different quanti- d saves 32 percent 5. Two countries, Richland and Poorland described by the Solow growth model. The the same Cobb-Douglas production functi F(KL) = A KL, but with different ties of capital and labor. Richland saves 32 of its income, while Poorland saves 10 perce Richland has population growth of 1 percent year, while Poorland has population growth of 3 percent. (The numbers in this problem are che sen to be approximately realistic descriptions of rich and...
2. Consider two countries: Mahaliaville and UWIville. Both countries have the same production: Y = K Neither country experiences population growth nor technological progress and both countries have a depreciation rate of 10%. Ma- haliaville saves 10 percent of ouput each year and UWIville saves 30% of output each year. (a) Find the steady-state levels of capital per worker, income per worker and consumption per worker for each country. (b) If both countries start with a capital stock per worker...
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Please answer the last person didn't answer all of it. Thank
you!
1 Growth Rates of Capital and Output Consider the following production function: Assume that capital depreciates at rate ? and that savings is a constant proportion s of output: Assume that investment is equal to savings: Finally, assume that the population is constant Lt = Lt+1 = L 1. The production function above expresses output as a function of capital and labor (workers) Derive a function that expresses...
3. The amount of education a person receives varies substantially among countries. Suppose you were to compare a country with a less educated labor force (with labor efficiency E1) and a country with a highly educated labor force (with labor efficiency E 2). Assume that education affects the level but not the growth of the efficiency of labor, that is E1
WRITING MUST BE CLEAR TO READ!
3. Country A and country B both have the production function Y = F(K, L) = K^(1/3) L ^(2/3). 3a. Does this production function have constant returns to scale? Explain. 3b. What is the per-worker production function, y = f(k)? 3c. Assume that neither country experiences population growth or technological progress and that 20 percent of capital depreciates each year. Assume further that country A saves 10 percent of output each year and country...
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