Answered step by step
Verified Expert Solution
Link Copied!

Question

1 Approved Answer

Question 1. Any economy is in long-run economic growth equilibrium. The population grows by 1% annually, the level of technology (E) advances by 1% annually,

Question 1.

Any economy is in long-run economic growth equilibrium. The population grows by 1% annually, the level of technology (E) advances by 1% annually, depreciation is 5% and the capital stock is twice the gross domestic product (GDP).

What is the ratio of investment to GDP?

a.9% b.20% c.12% d.14%

Question 2.

The following national accounts are available for the economy:

GDP has a market value of 500 Depreciation of fixed assets 70 Salary payments 315 Net transfers from abroad -20 Indirect grants 20 Net participation income from abroad 10 Indirect taxes 70

What is the share of wages in gross domestic product at factor value (also called income value or "basic price")?

a.84% b.86% c.70% d.98% e. 90% f. 88%

Question 3.

A certain consumer lives for two periods and is a net borrower in the first period.

How does consumption change in the previous period (C1) if the real interest rate falls?

a. Both the performance effect and the income effect are negative and C1 decreases

b. Both the performance effect and the income effect are positive and C1 increases

c.The efficiency effect is negative, but the income effect is positive, so the effect on C1 is unclear

d. The efficiency effect is positive, but the income effect is negative, so the effect on C1 is unclear

Step by Step Solution

There are 3 Steps involved in it

Step: 1

blur-text-image

Get Instant Access to Expert-Tailored Solutions

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

Step: 2

blur-text-image_2

Step: 3

blur-text-image_3

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

International Marketing

Authors: Philip R Cateora

14th Edition

0073380989, 9780073380988

More Books

Students also viewed these Economics questions

Question

1. Too reflect on self-management

Answered: 1 week ago

Question

Food supply

Answered: 1 week ago