As an economist working at the International Monetary Fund, youare given thefollowing data for...

As an economist working at the International Monetary Fund, you are given the
following data for Singapore: per capita GDP is 1.45 times that of Canada, and the
saving rate is the same as in Canada. If α=1/3, what do you conclude about TFP?
(a) Singapore’s TFP is approximately 44% larger
(b) Canada’s TFP is approximately 44% larger
(c) Singapore’s TFP is approximately 30% larger
(d) Canada’s TFP is approximately 30% larger
(e) None of the above

Solutions

Expert Solution

Answer) Option E is the right answer. On examination the absolute factor profitability of singapore is 45% more than that of Canada

A singapore= 1.45 A canada

Rahul Sunny answered 1 year ago

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