3. The following table provides data on output per worker, physical capital per worker, and human capital per worker, all relative to the United States. For each of the three countries listed, calculate factor accumulation and productivity relative to the United States. In which country does factor accumulation play the largest role in explaining income relative to the United States? In which country does productivity play the largest role?
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- Some resource-rich countries have succeeded in converting resource wealth into longterm and equitable economic development, while many others have not. Naturalresources have played a fundamental role in the growth of several industrializedeconomies, including Germany and the United Kingdom, where coal and iron ore depositswere a precondition for the Industrial Revolution. The United States was the world’sleading mineral economy from the mid-nineteenth to the mid-twentieth century and in thesame period became the world’s leader in manufacturing (van der Ploeg 2011). Morerecently, countries such as Botswana, Chile, and Norway have used abundant oil andmineral resources as the foundation for economic growth. However, in many othercountries, resource extraction appears to have undermined governance, fed corruptionand capital flight, and increased inequality.Required:(a) Discuss the main challenges posed by resource revenues; and(b) Discuss the special fiscal institutions and mechanisms…Show that, when using a traditional economic production function,doubling our population can double our output if capital stocks alsodouble. Use the production function: Q = AK L , where A representstechnology in an economy, K capital, and L labor. Double K and L andshow that Q also doubles, assuming α=β=1/2. Now show that, when we incorporate natural capital into thediscussion, doubling the population does not increase output in thesame way (since natural capital cannot also grow). Use theproduction function: Q = AK L N , where N is natural capital. DoubleK and L and show that Q less than doubles, assuming α=β=γ=1/3.The following table shows the GDP per capita of various countries forthe years 1960 and 2010 in PPP-adjusted 2005 dollars. The table alsocontains the implied growth rates, which show how much on average eachcountry needed to grow each year to reach the 2010 level of GDP per capitastarting from the 1960 level of GDP per capita. Use the table to answer thefollowing questions. 1. During 1960-2010, which countries failed to reduce the gap betweentheir GDP per capita and the U.S. GDP per capita?
- The following table shows the GDP per capita of various countries forthe years 1960 and 2010 in PPP-adjusted 2005 dollars. The table alsocontains the implied growth rates, which show how much on average eachcountry needed to grow each year to reach the 2010 level of GDP per capitastarting from the 1960 level of GDP per capita. Use the table to answer thefollowing questions. 1. Why have some countries reduced the gap between their incomes andthat of the United States and other countries failed to do so?What were the sources of labor productivity growth in the U.S. economy during the sixty years since 1960? How did the 1960s differ from the more recent decades? During the sixty years since 1960, the sources of labor productivity growth include O A. plastics, the laser, and the computer during the 1960s, and the Internet during later years O B. the focus on saving energy during the 1970s O C. the wide-spread introduction of the Internet during the 1970s O D. the global financial turmoil of 2008-2009 that made labor more productive Comparing the 1960s to the more recent decades, labor productivity growth than in subsequent decades. O A. in the 1960s was approximately 25 percent higher O B. in the 1960s was smaller C. due to technological change was smaller in the 1960s O D. due to physical capital and human capital growth was greater in the 1960s Click to select your answer. MacBook AExplain why U.S. potential GDP per worker per week is greater than that in Europe. What could induce Europeans to work the same hours as Americans and would that close the gap between potential GDP per worker in the two economies? U.S. potential GDP per worker per week is greater than that in Europe because O A. U.S. workers work fewer hours on average but they are more productive than Europeans O B. U.S. workers are more productive per hour of work and they work longer hours than Europeans C. the supply of labor in America is smaller than the supply of labor in Europe O D. the United States uses less capital but they use it more effectively Click to select your answer and then click Check Answer. 2. parts remaining Clear All MacBook Air 80 888 000 000 esc F1 F2 F3 F4 F5 F6 F7 F8 ! @ # $ 1 2 3 4 5 6 7 Q W E Y tab A S D F G H * 00 T R
- 4. The catch-up effect Consider the economies of Hermes and Gribinez, both of which produce gaggles of gop using only tools and workers. Suppose that, during the course of 20 years, the level of physical capital per worker rises by 4 tools per worker in each economy, but the size of each labor force remains the same. Complete the following tables by entering productivity (in terms of output per worker) for each economy in 2015 and 2035. Hermes Productivity Physical Capital Labor Force Output (Gaggles of gop) (Tools per worker) (Workers) (Gaggles per worker) Year 2015 11 30 3,000 2035 15 30 3,600 Gribinez Productivity Physical Capital Labor Force Output (Tools per worker) (Workers) (Gaggles of gop) (Gaggles per worker) Year 2015 8 30 2,400 2035 12 30 3,600 Initially, the number of tools per worker was higher in Hermes than in Gribinez. From 2015 to 2035, capital per worker rises by 4 units in each country. The 4-unit change in capital per worker causes productivity in Hermes to rise by…QUESTION 37 ROBOTS 60 50 40 30 20 10 0 a 10 b 20 C 30 40 50 BEFR 37. Assuming robots represents capital goods and beer consumer goods, and the growth path of country 1 is from point (a) to (b) to (c), while country 2 goes from points (d) to (e) to (f), what can you conclude about these countries? a) Country 1 has a higher savings rate b) Country 2 starts out with a higher standard of living c) Country 2 has a higher rate of growth d) Both (a) and (b) are correct e) None of the aboveduring the course of 20 years, the level of physical capital per worker rises by 5 tools per worker in each economy, but the size of each labor force remains the same. Bronscript Complete the following tables by entering productivity (in terms of output per worker) for each economy in 2020 and 2040. Physical Capital Year (Tools per worker) 2020 18 2040 23 Year 2020 2040 Physical Capital (Tools per worker) 15 20 Hestiatia Labor Force (Workers) 60 60 Labor Force (Workers) 60 60 Output (Crates of copia) 3,600 4,320 Pelheim Output (Crates of copia) 1,800 3,240 Productivity (Crates per worker) Productivity (Crates per worker) Initially, the number of tools per worker was higher in Hestiatia than in Pelheim. From 2020 to 2040, capital per worker rises by 5 units in each country. The 5-unit change in capital per worker causes productivity in Hestiatia to rise by a amount than productivity in Pelheim. This illustrates the effect.
- A country faces diminishing marginal returns when increasing it's capital stock. If this country added 1,000 units of capital last year and saw their GDP rise by $500 per person, what would you expect to happen if they had added 2,000 units of capital instead? O GDP would increase by another $500 per person O GDP would increase by less than another $500 per person O GDP would increase by more than another $500 per person O It is impossible to tell what would happen What is a potential downside of using patents to promote the creation of new technology? Without a market test, patents might be given to technology which ends up being useless. O Government money may be directed towards unproductive goals. It slows the spread and development of those ideas by restricting competition. They prohibit competition forever. What is the law of diminishing marginal returns?Select one or more: O a. If Country C's GDP per capita rises from $2,500 to 7,500, and Country D's GDP per capita rises from $6,000 to 18,000, the ratio of GDP per capita between the two countries is unchanged. O b. If a country's GDP doubles every 50 years on a ratio scale graph against time it will rise at an increasing rate. O c. Country B is growing a higher percentage rate than Country A, but Country A is 5 times richer than Country B. On a linear scale graph against time the gap between the two lines must be narrowing. O d. Country E is growing at the same percentage rate as Country F, but Country E is 3 times richer than Country F. On a log scale graph against time the gap between the two lines will be constant.Differences amongst countries in their standard of living can be attributed to differences in Select one: O a. population size, technology, and productivity. O b. political system, natural resources, and unselfish businesses. O c.skills, physical capital, technology, and institutions. O d. culture, location, education, and work ethic. O e. natural resources, capital, land area, and population size.