Suppose K and L grow at constant rates given by
And
)What is the growth rate of y if
?
D)Either a or b is correct.
E)None of the above is correct.

Question

Suppose K and L grow at constant rates given by 
And 
)What is the growth rate of y if 
?
D)Either a or b is correct. 
E)None of the above is correct.

Quizplus · Accepted Answer

Let's use the formula for exponential growth: y = Ce^(kt), where C is the initial value, k is the growth rate, and t is time. We know that K and L grow at constant rates, so we can write their equations as K = Ce^(a*t) and L = De^(b*t), where a and b are the growth rates for K and L, respectively. We want to find the growth rate for y, which is given by y = K*L. Substituting in the above equations, we get:

y = Ce^(a*t) * De^(b*t)
y = CDe^[(a+b)*t]

So the growth rate for y is (a+b), which is the sum of the growth rates for K and L. Therefore, the answer is either a or b, since they differ only in the second decimal place.

Suppose K and L Grow at Constant Rates Given by