User Account

All Pages

What are the capital share

Assignment Help Business Management
Reference no: EM131237158

Consider an economy with an aggregate wage bill of 200 billion dollars and an aggregate GDP of 400 billion. The aggregate GDP growth rate for this economy over the last 10 years was 8 percent (that is Δ Y/ Y=0.08) and the growth rates of capital and labor were 5 percent (Δ K/ K=0.05) and 5 percent (Δ L/L=0.05) respectively.

(a) What are the "capital share (α)" and the "labor share (1-α)"?

(b) What was the growth rate of "A" for this country?

(c) Imagine now that aggregate GDP is the SAME, but the wage bill is 300 billion. What is the growth rate of productivity now if the growth rates of GDP, capital and labor are still .08, 0.05 and 0.05 respectively? Explain intuitively why your answer is or is not different from (b).

(d) Repeat part (b) under the assumption that Δ K/K=0.10. Explain intuitively why your answer is or is not different from (b). I understand a, but trying to wrap my head around b, c and d

Reference no: EM131237158

Questions Cloud

Draw a diagram showing variation of the investors profit : An investor buys a European put on a share for $3. The stock price is $42 and the strike price is $40. Under what circumstances does the investor make a profit?
What is the exchange rate in ghana now : What is the exchange rate in Ghana now?what is the economic stand of the country now....what is the average wage of a Ghanaian citizen?
Why the tones sound full and rich : Well, what do you think? If a tree falls in the forest and no one is around to hear it, is there sound? (See chapter-opening Factinos.) When one sings in the shower, the tones sound full and rich. Why is this?
Same percentage of any tax cut : Will consumers always spend the same percentage of any tax cut? Why might they spend more or less than usual?
What are the capital share : (a) What are the "capital share (α)" and the "labor share (1-α)"? (b) What was the growth rate of "A" for this country?
What is the effect when a system is driven in resonance : What is the effect when a system is driven in resonance? Is a particular frequency required? Explain. Would you expect to find a node or an antinode at the end of a plucked guitar string? Explain.
What type of gate would you put in the top event box : If you want to make a fault tree for this, what text would you put in the top event box? What type of gate would you put in the top event box?
Draw diagram showing the variation of the investors profit : An investor sells a European call on a share for $4. The stock price is $47 and the strike price is $50. Under what circumstances does the investor make a profit? Under what circumstances will the option be exercised?
What are the wavelength limits of the audible range of sound : Approximately how long would it take for a telephone signal to travel 3000 mi from coast to coast across the United States? (Telephone signals travel at about the speed of light.) What are the wavelength limits of the audible range of the sound sp..

Reviews

Write a Review

Business Management Questions & Answers

  Evaluate a reliable way to measure it stressconsider you

evaluate a reliable way to measure it stressconsider you want to do a study in which class participation is an

  Explain adoption process

Explain how an understanding of the adoption process would help develop a promotion blend for digital tape recorder, a new consumer electronics product which produces high-quality recordings. Explain why you might change the promotion blend during..

  Motivation and performance management

Compare the difference between job satisfaction and organizational commitment. Determine which is more strongly related to performance for your selected company.

  Levels for divisions and management structures

Discuss the importance of the levels for divisions and management structures. Also discuss how multi-divisional structure of hierarchy in an organization helps in decentralized decision making.

  Allowable deduction for investment interest

1. What is Marjorie's allowable deduction for investment interest?

  Perform a swot analysis of the company''s decision

Describe how quality can be measured in an environment such as the one in which the company currently operates (the passenger tire market). In other words, what constitutes quality and how can we quantitatively determine whether the company has it..

  Explain the basic functions of management

Four Basic Functions of Management - competitive benchmarking wasn't effectively implemented, would we have to attribute it to poor controlling

  Opportunity cost of making loan

You loan a friend €1000, and at the end of one year she writes you a check for €1000to pay off this loan. If the annual interest rate on your savings account is 6 per cent, whatwas your opportunity cost of making this loan?

  Homeland security and emergency management degree program

Capstone Research Project This summative assignment represents the Capstone Project of the entire Homeland Security and Emergency Management degree program.

  Corporate social responsibility

At least one peer-reviewed journal article is required along with the textbook. Reference all sources using APA format. For guidance using APA format

  Example of a charismatic leader

Example of a charismatic leader and why they are successful and another paragraph

  A letter from a local public school requesting free passes

A letter from a local public school requesting free passes for their charity auction.

Free Assignment Quote

Assured A++ Grade

Get guaranteed satisfaction & time on delivery in every assignment order you paid with us! We ensure premium quality solution document along with free turntin report!

Submit Assignment

Academics

Major Subjects

Majors

Get In Touch

whatsapp: +1-415-670-9521

Phone: +1-415-670-9521

Email: [email protected]

TERMS & POLICIES

HELP & SUPPORT

All rights reserved! Copyrights ©2019-2020 ExpertsMind IT Educational Pvt Ltd