The economy of Alpha can be described by the Solow growth model. The following are some characteristics of the Alpha economy:
$$\begin{array} { l l }
\text { saving rate } ( \boldsymbol { s } ) & .20 \
\text { depreciation rate } ( \bar { \delta } ) & .12 \
\text { steady-state capital per worker } ( \boldsymbol { k } ) & 4 \
\text { population growth rate } ( \boldsymbol { n } ) & .02 \
\text { steady-state output per worker } & 20,000
\end{array}$$
saving rate (s) .20 depreciation rate (δ) .12 steady-state capital per worker (k) 4 population growth rate (n) .02 steady-state output per worker 20,000
a. What is the steady-state growth rate of output per worker in Alpha?
b. What is the steady-state growth rate of total output in Alpha?
c. What is the level of steady-state consumption per worker in Alpha?
d. What is the steady-state level of investment per worker in Alpha?

Question

The economy of Alpha can be described by the Solow growth model. The following are some characteristics of the Alpha economy:
$$\begin{array} { l l } 
\text { saving rate } ( \boldsymbol { s } ) & .20 \
\text { depreciation rate } ( \bar { \delta } ) & .12 \
\text { steady-state capital per worker } ( \boldsymbol { k } ) & 4 \
\text { population growth rate } ( \boldsymbol { n } ) & .02 \
\text { steady-state output per worker } & 20,000
\end{array}$$
 saving rate (s) .20 depreciation rate (δ) .12 steady-state capital per worker (k) 4 population growth rate (n) .02 steady-state output per worker 20,000
a. What is the steady-state growth rate of output per worker in Alpha?
b. What is the steady-state growth rate of total output in Alpha?
c. What is the level of steady-state consumption per worker in Alpha?
d. What is the steady-state level of investment per worker in Alpha?

Quizplus · Accepted Answer

The Answer of The economy of Alpha can be described by the Solow growth model. The following are some characteristics of the Alpha economy:
$$\begin{array} { l l } 
\text { saving rate } ( \boldsymbol { s } ) & .20 \
\text { depreciation rate } ( \bar { \delta } ) & .12 \
\text { steady-state capital per worker } ( \boldsymbol { k } ) & 4 \
\text { population growth rate } ( \boldsymbol { n } ) & .02 \
\text { steady-state output per worker } & 20,000
\end{array}$$
 saving rate (s) .20 depreciation rate (δ) .12 steady-state capital per worker (k) 4 population growth rate (n) .02 steady-state output per worker 20,000
a. What is the steady-state growth rate of output per worker in Alpha?
b. What is the steady-state growth rate of total output in Alpha?
c. What is the level of steady-state consumption per worker in Alpha?
d. What is the steady-state level of investment per worker in Alpha?

The Economy of Alpha Can Be Described by the Solow