51) In the absence of technological progress, we know with certainty that an decrease in the saving rate will cause which of the following? A) decrease steady state consumption B) increase steady state consumption C) have no effect on steady state consumption D) decrease steady state consumption only if the decrease in saving exceeds the increase in depreciation E) decrease steady state consumption only if the decrease in saving is less than the decrease in depreciation 52) As an economy adjusts to an decrease in the saving rate, we would expect output per worker A) to decrease at a constant rate and continue decreasing at that rate in the steady state. B) to decrease at a permanently higher rate. C) to increase at a permanently higher rate. D) to return to its original level. E) none of the above 53) Suppose the following situation exists for an economy: Kt+1/N t/N. Given this information, we know that A) saving per worker equals depreciation per worker in period t. B) saving per worker is less than depreciation per worker in period t. C) saving per worker is greater than depreciation per worker in period t. D) the saving rate fell in period t. E) none of the above 54) At the current steady state capital-labor ratio, assume that the steady state level of per capita consumption, (C/N)*, is greater than the golden rule level of steady state per capita consumption. Given this information, we can be certain that A) a reduction in the saving rate will cause a decrease in the steady state level of per capita consumption ((C/N)*). B) an increase in the capital-labor ratio will cause an increase in (C/N)*. C) the capital labor ratio will tend to decrease over time. D) the capital labor ratio will tend to increase over time. E) a reduction in the saving rate will have an ambiguous effect on (C/N)*. 55) Suppose the economy is initially in the steady state. A reduction in the depreciation rate (δ) will cause A) an increase in K/N. B) an increase in Y/N. C) an increase in C/N. D) all of the above E) none of the above 56) Which of the following will likely cause a reduction in output per worker? A) a reduction in education expenditures B) a reduction in the saving rate C) a reduction in on-the-job training D) all of the above 57) In the model where it is assumed that the state of technology does not change, what parameters and/or variables cause changes in steady state output per worker? A) savings rate B) depreciation rate C) human capital per worker D) all of above E) none of above
51) In the absence of technological progress, we know with certainty that an decrease in the saving rate will cause which of the following?
A) decrease steady state consumption
B) increase steady state consumption
C) have no effect on steady state consumption
D) decrease steady state consumption only if the decrease in saving exceeds the increase in
E) decrease steady state consumption only if the decrease in saving is less than the decrease in depreciation
52) As an economy adjusts to an decrease in the saving rate, we would expect output per worker
A) to decrease at a constant rate and continue decreasing at that rate in the steady state.
B) to decrease at a permanently higher rate.
C) to increase at a permanently higher rate.
D) to return to its original level.
E) none of the above
53) Suppose the following situation exists for an economy: Kt+1/N t/N. Given this information, we know that
A) saving per worker equals depreciation per worker in period t.
B) saving per worker is less than depreciation per worker in period t.
C) saving per worker is greater than depreciation per worker in period t.
D) the saving rate fell in period t.
E) none of the above
54) At the current steady state capital-labor ratio, assume that the steady state level of per capita consumption, (C/N)*, is greater than the golden rule level of steady state per capita consumption. Given this information, we can be certain that
A) a reduction in the saving rate will cause a decrease in the steady state level of per capita consumption ((C/N)*).
B) an increase in the capital-labor ratio will cause an increase in (C/N)*.
C) the capital labor ratio will tend to decrease over time.
D) the capital labor ratio will tend to increase over time.
E) a reduction in the saving rate will have an ambiguous effect on (C/N)*.
55) Suppose the economy is initially in the steady state. A reduction in the depreciation rate (δ) will cause
A) an increase in K/N.
B) an increase in Y/N.
C) an increase in C/N.
D) all of the above
E) none of the above
56) Which of the following will likely cause a reduction in output per worker?
A) a reduction in education expenditures
B) a reduction in the saving rate
C) a reduction in on-the-job training
D) all of the above
57) In the model where it is assumed that the state of technology does not change, what parameters and/or
variables cause changes in steady state output per worker?
A) savings rate
B) depreciation rate
C) human capital per worker
D) all of above
E) none of above
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