Defining the growth of variable zt as gz,in the combined Solow-Romer model,the growth rate of total output,using the production function
Is given as:

Question

Defining the growth of variable zt as gz,in the combined Solow-Romer model,the growth rate of total output,using the production function 
Is given as:

Quizplus · Accepted Answer

In the Solow-Romer model, the growth rate of total output is given by the formula:
gY = A * g(z) + (1-a) * g(L) + a * g(K)
where 
gY = growth rate of total output
A = technological progress
g(z) = growth rate of the variable z, assumed to be exogenous and representing the productivity of ideas
a = share of capital in output
g(L) = growth rate of labor
g(K) = growth rate of capital

In the given production function, Y = A * K^a * (EL)^(1-a) * z, we can see that z affects the productivity of the inputs, represented by A. Thus, we can assume that the growth rate of z is the same as the growth rate of A.

Therefore, the answer is C) 11ea895d_4d61_08fe_8397_e13539d6a96f_TB4305_11.

Defining the Growth of Variable Zt as Gz,in the Combined