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What elements of neoclassical and endogenous growth models can help us explain the remarkable growth of the group of countries known as the Asian Tigers?
Now suppose we have an endogenous growth model. How will a lower population growth rate affect the society's long-term growth potential?
Create a situation in which a single large firm dominates the economy, as traditional microeconomic reasoning would suggest?
What is endogenous growth? How do endogenous growth models differ from the neoclassical models of growth presented?
Show the new steady-state equilibrium. What has happened to per capita saving and the capital-labor ratio? What happens to output per capita?
What are capital's and labor's shares of income? At what rate is per capita output growing at the steady state? At what rate is total output growing?
What will happen to output per head if capital and labor both grow but Z is fixed?
Discuss the adjustment process of the economy, and using Figure 3-5 , show what happens to growth in the short run and in the long run.
What would be the effect (on output) of increasing the capital stock by 10 percent? What would be the effect of increasing the pool of labor by 10 percent?
If both labor and capital grow at 1 percent per year, what would the growth rate of total factor productivity have to be?
How long will it take for output to double? Now suppose technology grows at a rate of 2 percent. Recalculate your answers to ( a ) and ( b ).
The CPI and PPI are both measures of the price level. How are they different, and when might you prefer one of these measures over the other?
What are some problems with this interpretation? Which do you think is the biggest problem with it, and why?
Analyze what is the difference between GDP and GNP? Is one a better measure of income/output than the other? Why?
What would happen to GDP if the government hired unemployed workers, who had been receiving amount $ TR in unemployment benefits.
Suppose that actual output is $120 billion and potential (full-employment) output is $156 billion. What is an output gap in this hypothetical economy?
Using the aggregate supply-aggregate demand model, explain how output and prices are determined. Will output vary or stay fixed in the long run?
Suppose a landscaping firm offers a wage equal to $41. What is the average productivity of its workforce? On average, what is the firms profit per worker?
What are the implications for the supply curves facing the employers janitorial firms and hospitals?
Use your supply curves to compute the number of average and high-quality teachers. How has the composition of the workforce changed?
If the price elasticity of demand for the firm s product is 2.0, how will featherbedding affect the firm s total demand for labor?
Should the union increase or decrease the union wage? Explain. Why is there a trade-off between wages and total employment?
Assume that there is no substitution effect from changes in wages. Use two graphs to show effects of the increase in the wage on the quantity of labor demanded.
Suppose the union s objective is to maximize total labor income. What is the income-maximizing wage and quantity of labor demanded?
How does unionization affect wages and the composition of the workforce? What Happened to the High-Aptitude Female Teachers?