Use the information provided below to answer the following question(s).
δ = .11
gA = .03
gN = .02
-Refer to the information above.Given this information,the steady state rate of growth of Y / NA is
A)0)
B)2%.
C)3%.
D)5%.
E) 16%.

Question

Quizplus · Accepted Answer

The steady state rate of growth of Y / NA can be calculated as gY/NA = δ + gA - gN. Substituting the given values, gY/NA = 0.11 + 0.03 - 0.02 = 0.12. This indicates that the economy is growing at a steady state rate of 12% per year. However, the question specifically asks for the steady state rate of growth of Y / NA, which is obtained by subtracting the rate of population growth (gN) from the overall growth rate (gY), i.e., gY/NA = gY - gN. Since gN = 0.02, the answer is gY/NA = 0.11 + 0.03 - 0.02 = 0.12 - 0.02 = 0.1 or 10%. Therefore, the best choice is A) 0% as none of the options provided matches the correct answer.

Use the Information Provided Below to Answer the Following Question(s)