Explain what condition must occur for each of the following to occur: (1 ) the capital stock to increase; (2 ) the capital stock to decrease; and (3 ) the capital stock to remain constant

What will be an ideal response?


The equation for the change in the capital stock (per worker) is given by the following: (Kt+1/N) - (Kt/N) = s(Yt/N) - ?(Kt/N). The capital stock will not change when investment equals depreciation. If investment/saving exceeds (is less than) depreciation, the capital stock will grow (decline).

Economics

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Other things the same, when the price level rises more than expected, some firms will have

a. higher than desired prices, which increases their sales. b. higher than desired prices, which depresses their sales. c. lower than desired prices, which increases their sales. d. lower than desired prices, which depresses their sales.

Economics

The Lorenz curve is criticized for all of the following EXCEPT

A. that it excludes transfers-in-kind income. B. that it does not account for the size differences of households. C. that it does not account for the impact of trade on the standard of living. D. that it does not account for age differences of households.

Economics

Suppose output is $35 billion, government purchases are $10 billion, desired consumption is $15 billion, and desired investment is $6 billion. Absorption is equal to

A. $25 billion. B. $39 billion. C. $35 billion. D. $31 billion.

Economics

Which of the following examples shows a surplus?

a. At $15,000 per automobile, a company produces 1,000 automobiles and has a demand for 3 more. b. At $15,000 per automobile, a company produces 1,000 automobiles and has a demand for 400 more. c. At $15,000 per automobile, a company produces 1,000 automobiles and sells 1,000. d. At $15,000 per automobile, a company produces 1,000 automobiles and sells 700.

Economics