Explain why in the neoclassical growth model with exogenous technological change, the long-run equilibrium rate of growth in output is independent of the saving rate (S/Y)?
Consider the neoclassical consumption model with log utility and ? = 1. Suppose an individual begins with $10,000 in stocks and $30,000 of equity in her house, so that financial assets are ftoday = $40,000. Suppose her labor income stream is $50,000, both today and in the future, and suppose the...
In the neoclassical growth model we express the investment function as i= sf(k), where i is investment per worker, s is the saving ratio, k is capital per worker, and y is output per worker. A) Plot the saving function, i= sf(K) and output function y=f(k)=k1/2, where s=0.3and values of k vary...
Suppose demand and supply are given by Qd = 50 – P and Qs = ½ P – 10.a. What are the equilibrium quantity and price in this market?b. Determine the quantity demanded, the quantity supplied, and the magnitude of the surplus if a price floor of $42 is imposed in this market.c. Determine the...
Go to Loughran and McDonald’s sentiment word lists at https://www3.nd.edu/~mcdonald/Word_Lists.html and download the Master Dictionary. These are what they’ve used to assess sentiment in financial statements and related financial reports. Give five words that are considered to be...
In 1910, E. Rutherford and H. Geiger showed experimentally that the number of alpha particles emitted per second in a radioactive process is a random variable X having a Poisson distribution. If X has mean 0.5, what is the probability of observing two or more particles during any given second?
On April 1, 20-3, Kwik Kopy Printing purchased a copy machine for $50,000. The estimated life of the machine is five years, and it has an estimated salvage value of $5,000. The machine was used until July 1, 20-6. REQUIRED 1. Assume that Kwik Kopy uses straight-line depreciation and prepare the...
The following information has been extracted from the draft financial statements of Snowdrop, a limited liability company. SNOWDROP STATEMENTS OF FINANCIAL POSITION AS AT 31 MAY 2019 2020 GHc\'000 GHc\'000 GHc\'000 Non-current assets 4,600 Current assets Inventory 580 500 Trade receivables 360 Bank...
Write a program that allows the user to play \"Rock, Paper, Scissors\". Write the RPS class. All code should be in one file. main() will be part of the RPS class, fairly small, and contain only a loop that asks the user if they want to play \"Rock, Paper, Scissors\". If they say yes, it calls the...
Consider a neoclassical growth model with full depreciation E8* {log (c) – Ahn} 0 < B < 1 A >0 max {ct, kt+1, it,ht}, t=0 s.t. C + it 0 < a <1 it kt+1 ko > 0, given, where ct, kt+1, it and ht are consumption, next-period capital, investment and hours worked, respectively; B E (0,1) is the subjective discount factor; de (0, 1] is the subjective discount factor; a E (0, 1) is the share of capital in production. 1. Write down the optimality conditions for this problem. (Hint: sub- stitute the constraints into the utility function to have just kt and he and compute the corresponding first-order condition with respect to these two vari- ables). 2. Verify that the following solution satisfies the optimality conditions 1- a 1 (1) А 1 - aß 1-a 1- a k' aß A (1- aß) (2) 1- a 1- a C = k°. (3) (A (1 – aß)) A 3. Find steady state consumption, capital, labor, wage and interest rate. 4. Plot the decision function k' in terms of k (this function can also be interpreted as k+1 in terms of k). Show the dynamics on the graph for initial conditions above and below the steady state. 5. Assume a = 1/3, B = 0.9 and A = 1. Assume ko is 50% below the steady state. Compute k1, k2, k3, k4, k5 and co, cı, C2, C3, C4. Assume also ko is 50% above the steady state. Compute k1, k2, k3, k4, ks and co, C1, C2, C3, C4. Plot the resulting quantities on the graphs expressing on one graph, capital as a function of time and expression on the other graph consumption as a function of time.
