Suppose an economy makes investment of five units every year for the next five years. The annual depreciation rate of capital is 10%. The current level of capital is 60. What is the level of capital in two years from now?
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- Assume that the production function for a country is given by Y = √K and annual investment is given by the function I=yxY where y = 0.3100, and that the yearly depreciation rate is 5.167%. Suppose that this year, the output in the country is 1, and a neighbor country's output is 50% higher. Calculate the time it would take for the country's output to catch up with its neighbor's output. Assume the neighbor country's economy is neither growing nor shrinking. yearswhat is the steady state of equilibrium for capital labor (K) if the national savings rate is 0.14 and the depreciation rate is 0.04?Assume that the production function for a country is given by Y=√K and annual investment is given by the function I=γ×YI where γ=0.280, and that the yearly depreciation rate is 4.67%. Suppose that this year, the output in the country is 1, and a neighbor country's output is 50% higher. Calculate the time it would take for the country's output to catch up with its neighbor's output. Assume the neighbor country's economy is neither growing nor shrinking.
- Suppose that the production function for an economy is given by Y = K1/4L3/4. The depreciation rate is 4%, the saving rate is 12%, Show the steady state in a graph. In the same graph, show the effect of a decrease in the depreciation rate, say to 2%Suppose that the production function for an economy is given by Y = K1/4L3/4. The depreciation rate is 4%, the saving rate is 12%, Explain how the economy goes from one steady state to another.The saving rate is 30% and the depreciation rate is 10%. The production function of the economy is given as: Y = K05 L05 What is the steady state level of capital? Answer Choices: a. 9 units b. 10 units c. 11 units d. 12 units
- What is the exponential growth rate change of an investment that has a b=1.24? Use the paperclip button below to attach files. Student can enter max 3000 characters BI DELL UAssume the per-worker production function is y = 2k05 The saving and depreciation rates are 0.2 and 0.04 respectively. Calculate the value for output per worker (y) at the steady state, assuming no population growth. Answer:1)Consider an economy whose production function is: y=k^(1/2) with an investment rate of 50% and depreciation rate of 10%. Then the steady-state levels of output per worker and capital per worker are…. and…….respectively. 5 ; 25 25 ; 5 0.5 ; 0.1 0.1 ; 0.5 2)If the current level of capital per worker is 30, then The country is at the steady-state The country is above the steady-state The country is below the steady-state We need to calculate the current level of income per worker to know the state of the economy.
- Assume that the production function for a country is given by Y = √K and annual investment is given by the function I = √ × Y where 0.320, and that the yearly depreciation rate is 5.33%. Suppose that this year, the output in the country is 1, and a neighbor country's output is 50% higher. Calculate the time it would take for the country's output to catch up with its neighbor's output. Assume the neighbor country's economy is neither growing nor shrinking. yearsQuestion 2Assume production function is given by:Y= K(1/2) L(1/2)a. Write the production function in per worker terms (y=f(k))b. Assume that the per worker level of capital in the steady state is 4, the depreciation rate is 5% per year, and population growth is 5% per year. Does this economy have “too much” or “too little” capital? How do you know? [Show your work].The steady occurs when the economy is in equilibrium. Specifically, the steady state refers to the situation where K/N and Y/N are constant. K/N will not change when investment per worker equals depreciation per worker. During the adjustment process, the growth rates of Y, Y/N, and K/N will all be negative. Once the steady state is reached, these variables are constant and the growth rates will be zero. True False