4) As an economy adjusts to an increase in the saving rate, we would expect output per worker Show Get answer to your question and much more 5) Suppose the saving rate is initially less than the golden rule saving rate. We know withcertainty that a reduction in the saving rate will causeA) a reduction in the capital labor ratio.B) a reduction in output per worker.C) a reduction in consumption per worker.D) all of theseE) none of these Chapter 121) In the following production function, Y = f(K, NA), a 20% increase in A will cause which ofthe following variables to increase by 20%? Get answer to your question and much more 2) Which of the following will cause an increase in output pereffectiveworker? Get answer to your question and much more Use the following information to answer the question(s) below:(1) the rate of depreciation is 10% per year,(2) the population growth rate is 2% per year, and(3) the growth rate of technology is 3% per year.3) Refer to the information above. Which of the following equals the annual growth rate of"effective labor" in the steady state in this economy? Get answer to your question and much more An increase in the saving rate will affect which of the following variables in the long run? A reduction in the saving rate will not affect which of the
following variables in the long run? B) the growth rate of output per worker Which of the following statements is always true? D) Any change in the capital stock is equal to investment minus depreciation. In the absence of technological progress, which of the following remains constant in the steady state equilibrium? When an economy is operating at the steady state, we know that C) steady state saving is equal to depreciation per worker. In the absence of technological
progress, which of the following is true when the economy is operating at the steady state? A) The growth of output per worker is zero. When steady state capital per worker is above the golden-rule level, we know with certainty that an increase in the saving rate will B) decrease consumption in both the short run and the long run. Suppose two countries are identical in every way with the following exception. Economy A has a higher rate of depreciation (δ) than economy B. Given this information, we know with certainty that B) steady state consumption in A is lower than in B. Which
of the following represents the change in the capital stock? D) investment minus depreciation When the economy is in the steady state, we know with certainty
that A) investment per worker is equal to depreciation per worker. Suppose the economy is initially in the steady state.
An increase in the depreciation rate (δ) will cause Suppose the following situation exists for an economy: Kt+1/N < Kt/N. Given this information, we know that B) saving per worker is less than depreciation per worker in period t. If the saving rate is 1 (i.e., s = 1), we know that What happens when savings rate increases?A higher saving rate does result in a higher steady-state capital stock and a higher level of output. The shift from a lower to a higher steady-state level of output causes a temporary increase in the growth rate. In some newer theories of growth, a higher saving rate may permanently raise the rate of economic growth.
What is the effect of a higher saving rate in the long run?Although the saving rate s does raise the rate of economic growth in the short run, it has no effect on the rate of growth in the long run. A higher value s does raise the steady-state capital/labor ratio k. Hence the steady-state output per capita rises.
What is the effect of a higher saving rate in the long run quizlet?The higher saving rate leads to a higher growth rate of productivity in the long-run. The accumulation of capital is subject to diminishing returns: The more capital an economy has, the less additional output the economy gets from an extra unit of capital.
How does an increase in saving rate affect economic growth?A rise in aggregate savings would yield larger investments associated with higher GDP growth. As a result, the high rates of savings increase the amount of capital and lead to higher economic growth in the country.
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An increase in the saving rate will affect which of the following variables in the long run
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