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The U.S. economy normally grows. How fast does the U.S. economy normally grow in real terms?..
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- Illustrate the transition of an economy to the steady state in a diagram, and explain it in words. Hint: Consider what would happen with capital per worker and output per worker if the economy was to the left or to the right of the steady state in a diagram.Describe how Research and Development (R&D) can boost the economy ?If output rises by 35 percent while hours of work increase by 40 percent, has productivity increased or decreased? By how much?
- Suppose there are two countries, India and Bangladesh. In country India, Real GDP grows by 3 percent each year. In country Bangladesh, Real GDP is the same each year: If Real GDP was $1000 billion last year, it is $1000 billion in the current year, and it will be $1000 billion next year. In which of the two countries would you prefer to live, ceteris paribus? Why? Explain.According to the figure showing 2020 GDP for selected countries, how much larger (in percentage terms) is America’s GDP than: a. Great Britain? b. Haiti?relate the terms: increase, growth.
- How come higher saving leads to more rapid growth?Draw a graph of "catch-up" that shows where you would expect to see a country with low saving rates and low levels of health and education. How would you expect real GDP per capita to grow in a country like this?Go to a recent issue of The Economist magazine. In the back of each issue is a section called “economic indicators.” That section lists the most recent growth data for a substantial number of countries. Which countries around the world are growing most rapidly according to the most recent data? Which countries around the world are growing more slowly? Flip through the stories in The Economist to see if there is any explanation for the pattern that you observe. Write a brief essay on current general economic conditions around the world.
- Why do economists pay more attention to national economies (for example, the U.S. or Canadian economies) than to state or provincial economies (such as California or Ontario)?Is it possible for GDP to rise while at the same time per capita GDP is falling? Is it possible for GDP to fall while per capita GDP is rising?Propose one explanation for why the fastest-growing region will increase faster than other regions