Given the real outputs, population, capital, the share of household consumption at current PPPs(at current PPPs...
Fantastic news! We've Found the answer you've been seeking!
Question:
Transcribed Image Text:
Given the real outputs, population, capital, the share of household consumption at current PPPs(at current PPPs means that we are keeping prices constant over time and comparable between countries so you don't need to worry about inflation) Assume that the production function of your country at period t is given by Y (t) = A(t)K(t)^a L(t)^1-a, where a = 0.3, Y is output, K is capital, L is labor, and A is the technological level of the country. Assume for now that A(t) = 1 in any period. Also, assume that the depreciation rate of capital is ō = 0.01. 1. Assuming that all output not consumed is saved how to calculate the average (overall years) saving rate in that country(just give a formula) 2. How to calculate the steady-state level of capital and output per capita. (just give a formula) 3. How to calculate the modified golden rule of this economy. (just give a formula) Consider a two-consumer, two-good exchange economy. Consumer A has utility function UA(TA, ²) = (1)(12)³ and endowment A = (4,0). Consumer B has utility function UB(TB, 3) = 5 and en- dowment WB = (0,4). Normalize p₁ = 1 and let the price of good 2 be p2. a) Write demand functions for consumer A in terms of prices. b) Thus find a competitive equilibrium in which 21 = 1. P2 c) Show with an example that the competitive equilibrium in b) is not Pareto efficient. d) Why does the first welfare theorem fail to hold in this economy? 3. Optimal Input Mix. Standard Enterprises produces an output that it sells in a highly competitive market at a price of $100 per unit. Its inputs include two machines which cost the firm $50 each and workers, who can be hired on an as-needed basis in a labor market at a cost of $2,800 per worker. Based on the following production data, how many workers should the firm employ to maximize its profits? A. 8. C. Machines (M) 2 2 2 2 2 2 2 Workers (L) 0 1 2 3 4 5 6 Output 0 60 Q=F(K, L) = K L + 100 129 148 160 168 Marginal Product of Labor (MP) Average Product of Labor (AP) VALUE Marginal Product (VMP.) Fill in the missing data for marginal product of labor (MPL), average product of labor (APL) and Value marginal product of labor (VMPL). Where Q What is the profit maximization optimal input mix condition (rule) for this problem? Based on the above production data, how many workers should the firm employ to maximize its profits? Wage $2,800 $2,800 $2,800 $2,800 $2,800 4. A firm can manufacture a product according to the following production function: $2,800 $2,800 = output K= capital Calculate the average product of labor (APx)) and Marginal Product of labor (MPL) when capital is fixed at 80 and labor is 35. L = labor 11. Consider an economy with 2 firms and 2 consumers. Firm i is owned by consumer i(= 1,2). Firm 1 produces virtual reality machines (VRMs) using oil via the production function v = 2x. Firm 2 produces bread via the production function b = 3r. Consumer 1 has utility function U¹(v₁) = 100+ 4v4 and has an endowment of 10 units oil. Consumer 1 has utility function U2 (v₂) = 1020 and has an endowment of 10 units of oil too. 0.4 a. Determine the input demand and output supply functions for the two firms. Given the real outputs, population, capital, the share of household consumption at current PPPs(at current PPPs means that we are keeping prices constant over time and comparable between countries so you don't need to worry about inflation) Assume that the production function of your country at period t is given by Y (t) = A(t)K(t)^a L(t)^1-a, where a = 0.3, Y is output, K is capital, L is labor, and A is the technological level of the country. Assume for now that A(t) = 1 in any period. Also, assume that the depreciation rate of capital is ō = 0.01. 1. Assuming that all output not consumed is saved how to calculate the average (overall years) saving rate in that country(just give a formula) 2. How to calculate the steady-state level of capital and output per capita. (just give a formula) 3. How to calculate the modified golden rule of this economy. (just give a formula) Consider a two-consumer, two-good exchange economy. Consumer A has utility function UA(TA, ²) = (1)(12)³ and endowment A = (4,0). Consumer B has utility function UB(TB, 3) = 5 and en- dowment WB = (0,4). Normalize p₁ = 1 and let the price of good 2 be p2. a) Write demand functions for consumer A in terms of prices. b) Thus find a competitive equilibrium in which 21 = 1. P2 c) Show with an example that the competitive equilibrium in b) is not Pareto efficient. d) Why does the first welfare theorem fail to hold in this economy? 3. Optimal Input Mix. Standard Enterprises produces an output that it sells in a highly competitive market at a price of $100 per unit. Its inputs include two machines which cost the firm $50 each and workers, who can be hired on an as-needed basis in a labor market at a cost of $2,800 per worker. Based on the following production data, how many workers should the firm employ to maximize its profits? A. 8. C. Machines (M) 2 2 2 2 2 2 2 Workers (L) 0 1 2 3 4 5 6 Output 0 60 Q=F(K, L) = K L + 100 129 148 160 168 Marginal Product of Labor (MP) Average Product of Labor (AP) VALUE Marginal Product (VMP.) Fill in the missing data for marginal product of labor (MPL), average product of labor (APL) and Value marginal product of labor (VMPL). Where Q What is the profit maximization optimal input mix condition (rule) for this problem? Based on the above production data, how many workers should the firm employ to maximize its profits? Wage $2,800 $2,800 $2,800 $2,800 $2,800 4. A firm can manufacture a product according to the following production function: $2,800 $2,800 = output K= capital Calculate the average product of labor (APx)) and Marginal Product of labor (MPL) when capital is fixed at 80 and labor is 35. L = labor 11. Consider an economy with 2 firms and 2 consumers. Firm i is owned by consumer i(= 1,2). Firm 1 produces virtual reality machines (VRMs) using oil via the production function v = 2x. Firm 2 produces bread via the production function b = 3r. Consumer 1 has utility function U¹(v₁) = 100+ 4v4 and has an endowment of 10 units oil. Consumer 1 has utility function U2 (v₂) = 1020 and has an endowment of 10 units of oil too. 0.4 a. Determine the input demand and output supply functions for the two firms.
Expert Answer:
Answer rating: 100% (QA)
Economic Growth Model Questions 1 Average Saving Rate The average saving rate s can be calculated as the ratio of total savings to total output over the entire period In this case since all output not ... View the full answer
Related Book For
Fundamentals of Cost Accounting
ISBN: 978-0077398194
3rd Edition
Authors: William Lanen, Shannon Anderson, Michael Maher
Posted Date:
Students also viewed these accounting questions
-
The file survey.mtw contains selected variables from an online survey of ADM 2304 students. Assume that these results represent a random sample of all Telfer undergraduate students. The variables are...
-
KYC's stock price can go up by 15 percent every year, or down by 10 percent. Both outcomes are equally likely. The risk free rate is 5 percent, and the current stock price of KYC is 100. (a) Price a...
-
Case Swimmers Headphones1 Finally! Its the end of 2019 and you are sitting at your new desk in a plush office in north Bogota, with a delicious cup of Colombian coffee. You think about all it took to...
-
Modify BST to add a method size() that returns the number of key-value pairs in the symbol table. Use the approach of storing within each Node the number of nodes in the subtree rooted there.
-
The spectral transmissivity of a 50-m-thick polymer film is measured over the wavelength range 2.5m < < 15m. The spectral distribution may be approximated as = 0.80 for 2.5m < < 7m, = 0.05 for 7m...
-
A steel specimen \(2 \mathrm{~cm}^{2}\) are of cross-section elongates by \(0.1 \mathrm{~mm}\) over a gauge length of \(50 \mathrm{~mm}\) under an axial load of \(40 \mathrm{kN}\). Calculate the...
-
The capital structure of Audiology Associates, Inc., at December 31, 2007 , included 5,000 shares of \(\$ 2\) preferred stock and 100,000 shares of common stock. Common shares outstanding during 2008...
-
Your client, Luther Lifo, is a professor who runs a CPA review course. He comes to you with the following tax questions: Question One. Luther teaches CPA review courses on either a guaranteed or a...
-
PLEASE SHOW ALL WORK 4 10 points Problem 3-23 (Algo) After using your forecasting model for six months, you decide to test it using a tracking signal. Here are the forecast and actual demands for the...
-
When Corona leased farmland to a strawberry farmer named Armando Munoz Juarez, it claimed a security interest in his strawberry crop. Coronas financing statement listed the farmers name as Armando...
-
The function in the query that allows me to choose my favorite fields the tables to constitute the query is called as: one: a . Relationship b . Joint c . Projection d . ion
-
Describe how technology can be integrated into the retail management strategy to improve the customer experience. Provide examples of technology solutions that can be implemented.
-
The surface area and volume of a sphere are given by following formulas, where r is the radius of the sphere and is a constant. area = 4r 4 volume ==r Write a Python program that will ask the user to...
-
3. Find the horizontal (H.- +ve) and vertical (V.1 +ve) reactions at the supports A and B for the following structure. 2m L. RAH = ii. RAV = iii. RBH = 2m A 2m A. -100 N B. -50 N C. ON D. 33.3 N 2m...
-
How do technology standards bodies, consortia, and industry alliances facilitate interoperability, compatibility, and harmonization of technical specifications and protocols across diverse platforms,...
-
2 2 -2 Q.1. Let A= B = [ ; } ] and C= 0 3 -3 3. 6 Find (a) AB (b) A-2C (c) BA (d) 54 A+3B (e) BA (f) BI,, here I, is an identity matrix of size 22, (g) BC, if exists. Q.2. Find p and q if A Bas C35...
-
Locate a news story about identity theft and comment on it. How prominent of an offense is identity theft? How should it be punished? What can be done to reduce the occurrence of this offense? Please...
-
On August 31, 2012, the balances of the accounts appearing in the ledger of Wood Interiors Company, a furniture wholesaler, are as follows:Prepare the August 31, 2012, closing entries for Wood...
-
Peninsula Candy Company makes three types of candy bars: Chewy, Chunky, and Choco-Lite (Lite). Sales volume for the annual budget is determined by estimating the total market volume for candy bars...
-
Curts Casting manufactures metal parts in a large manufacturing facility. Curts customers order 100,000 tons of castings each quarter. The facility has a practical capacity of 150,000 tons. Curt...
-
Alameda Tile sells products to many people remodeling their homes and thinks that they could profitably offer courses on tile installation, which might also increase the demand for their products....
-
A part of a mechanism which operates a horizontally sliding block \(E\) is shown in Fig.3.23(a). In the given configuration, the lever \(O B\) swings about \(O\) in the clockwise direction with an...
-
In the mechanism shown in Fig.3.21(a), the link \(O_{1} A\) rotates at \(24 \mathrm{rad} / \mathrm{s}\). Find the velocity and acceleration of point \(B\). \(O_{1} A=75 \mathrm{~mm}, A B=200...
-
A double slider-crank mechanism is shown in Fig.3.22(a). Crank 2 rotates at constant angular speed \(\omega_{2}=10 \mathrm{rad} / \mathrm{s}\). Determine the velocity and acceleration of each slider....
Study smarter with the SolutionInn App