Answered step by step
Verified Expert Solution
Link Copied!

Question

00
1 Approved Answer

. Over the last ten years, the (hypothetical) country of Gaul has experience GDP growth of 1.2% per year. The elasticity of output to capital

. Over the last ten years, the (hypothetical) country of Gaul has experience GDP growth of 1.2% per year. The elasticity of output to capital is 0.45. The growth of capital has been 3%, and the growth of labor has been 1%, over the same period. Assuming constant returns to scale in production, which of the following is correct?

a.Output per capital, on average, fell over the past 10 years.

b.Gaul experienced positive productivity growth, on average, over the past 10 years.

c.Gaul had zero productivity growth, on average, over the past 10 years.

Gaul experienced negative productivity growth, on average, over the past 10 years.

Step by Step Solution

There are 3 Steps involved in it

Step: 1

blur-text-image

Get Instant Access with AI-Powered Solutions

See step-by-step solutions with expert insights and AI powered tools for academic success

Step: 2

blur-text-image

Step: 3

blur-text-image

Ace Your Homework with AI

Get the answers you need in no time with our AI-driven, step-by-step assistance

Get Started

Recommended Textbook for

Statistics Informed Decisions Using Data

Authors: Michael Sullivan III

5th Edition

9780134133539

Students also viewed these Economics questions