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o Devoting a larger share of national output to investment would help restore rapid productivity growth and rising living standards. Do you agree with this

o "Devoting a larger share of national output to investment would help restore rapid productivity growth and rising living standards." Do you agree with this claim? Explain, using the Solow model. o Many demographers predict that the United States will have zero population growth in the coming decades, in contrast to the historical average population growth of about 1 percent per year. Use the Solow model to forecast the effect of this slowdown in population growth on the growth of total output and output per person. Consider the effects both in the steady state and during the transition between steady states. o The amount of education the typical person receives varies substantially among countries. Suppose you were to compare a country with a highly educated labor force and a country with a less educated labor force. Assume that education affects only the level of the efficiency of labor. Also assume that the countries are otherwise the same: They have the same saving rate, the same depreciation rate, the same population growth rate, and the same rate of technological progress. Both countries are described by the Solow model and are in their steady states. How would the following variables differ between the countries? The rate of growth of total income. The level of income per worker. The real rental price of capital. The real wage. o In the economy of Solovia, the owners of capital get two-thirds of national income, and the workers receive one-third. The men of Solovia stay at home performing household chores, while the women work in factories. If some of the men start working outside the home so that the labor force increases by 5 percent, what would happen to the measured output of the economy? Does labor productivity defined as output per worker increase, decrease, or stay the same? Does total factor productivity increase, decrease, or stay the same? In year 1, the capital stock was 6, the labor input was 3, and output was 12. In year 2, the capital stock was 7, the labor input was 4, and output was 14. What happened to total factor productivity between the two years? PLEASE BIBLIOGRAPHY

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