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Q. Reflect on the Solow Growth Model by means of technology given by Y = zF(K, N) = K^(1/2)N^(1/2), its savings rate is 0.2 moreover its depreciation rate is 0.1. Together the population growth as well as the technological growth is 0. Notify that the lower caseletters denote per capita variables e.g. y=Y/N).
(a) Elucidate the steady state values of c, y, k and i?
(b) Elucidate the values of y and k only if economy operates at "Golden Rule" level of capital accumulation?
(c) Elucidate the saving rate which you've to impose also the level of c? Envision that you want to drive this country in the "Golden Rule" levels of k and y.
(d) Elucidate what would be the immediate and long run effects on c, k, and y? Explain by drawing the path of these variables. Consider that you impose the new saving rate.
Explain basic idea behind Big Push model. How can O-ring theory help explain existence of a low-level equilibrium that an economy may find itself.
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Because their countries have similar institutions, the price paid for a computer in Germany and the United States are about the same when converted into the same currency.
Economies grow for a variety of reasons. Which of the following is not a primary cause of economic growth?
What advantages might a socialist system have in responding to the needs of people struck by an emergency situation like the earthquake that occurred in Haiti in January, 2010?
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Assume that Ms. Thompson is currently exhausting her money income by purchasing 10 unites of A and 8 unites of B at price $2 and $4 respectively. Elucidate what these data suggest about Ms. Thompson.
Textile Workers of America is planning to strike for higher wages. Management predicts that if strike is successful, cost of labour will increase $100 per day. If strike is successful, how would this affect decision in part a to purchase a textile..
The company uses an effective income tax rate of 40%, and the after-tax MARR of 15% per year. What is the approximated value of the company's before-tax MARR?
Illustrate what relationship exists and how might a business manager use this information to increase their profits.
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