whyoptimal solution is better than the golden rule

why optimal solution is better than the golden rule

Expert Solution

Golden rules are the principles that are formed to be applicable generally to the similar situations as stated in the rule where as optimal situation is the customised solution for the given situation or activity that satisfies the activity to the maximum [which can be based on golden rules or may be some amendements are made in golden rule to apply that optimal solution to the given problem].

Therefore, it can be said that optimal solutioon are worth satisfying the situation thus they are better than the golden rules.

For, example law of demand [in microeconomics] tells bout the inverse relation between the price and the quantity demanded at given prices.

But , in some conditions there are exceptions of law of demand too , for example veblen goods[also called article of distinction] in which as the prices rise there will be increase in demand.

So, here the golden rule is failed but the optimal solution of categorizing such category differntly gives us better way to deal.

Rahul Sunny answered 2 years ago

Derivation of fermi golden rule?

Might a policymaker choose a steady state with more capital than in the Golden Rule steady...

Might a policymaker choose a steady state with more capital than in the Golden Rule steady state? With less capital than in the Golden Rule steady state? Explain your answers.

Derivation clearly of fermi's golden rule ?

. Using the Solow model, illustrate and explain an economy at the Golden Rule level of...

. Using the Solow model, illustrate and explain an economy at the Golden Rule level of capital per worker. Note: you must include the derivation of the mathematical condition in your answer.

The golden rule is defined as the saving rate that maximizes consumption at the balanced growth...

The golden rule is defined as the saving rate that maximizes consumption at the balanced growth path. Where is the golden rule higher? (also graphically). Why are they different?

20. If the capital stock is ABOVE the Golden Rule level, an increase in the capital...

20. If the capital stock is ABOVE the Golden Rule level, an increase in the capital stock would A raise output less than depreciation B raise output more than depreciation 21. If the capital stock is ABOVE the Golden Rule level, an increase in the capital stock would A cause consumption to fall B cause consumption to rise 22. At the Golden Rule level of capital, A the marginal product of capital per worker equals the depreciation rate B the...

What is meant by the golden rule level of capital? Explain what condition on the MPK...

What is meant by the golden rule level of capital? Explain what condition on the MPK is required if we are to have the golden rule. Explain why this condition is necessary. Finally, true or false: over time, the Solow model predicts that the capital stock approaches the golden-rule level.

Treat your internal customers as you would like to be treated is the golden rule to...

Treat your internal customers as you would like to be treated is the golden rule to follow in customer service. * 3 points True False Even though feedback can help us in knowing our customer opinion and experience; however, all customers should be given the same rewards as a way of appreciation. * 3 points True False The more creative the customer service providers are, the more the customers will be satisfied. * 3 points True False External customers are...

In order to maximize the steady state level of consumption per worker, the Golden Rule steady...

In order to maximize the steady state level of consumption per worker, the Golden Rule steady state capital stock per worker (k*gold) satisfies the condition that the marginal productivity of capital at the k*gold capital level equals the depreciation rate . Graphically illustrate how to find the k*gold. (20 points)

Chapter 3 concludes with an article titled "Sustainability, ROA, and the Golden Rule." Please read that...

Chapter 3 concludes with an article titled "Sustainability, ROA, and the Golden Rule." Please read that article and discuss why it may be profitable in the long-term to operate a firm in a sustainable manner. Give examples of sustainability practices being used in industry today and discuss their profitability or lack thereof. The article: "Sustainability, ROA, and the Golden Rule” Perhaps “sustainability” isn't the first word that comes to mind when someone thinks about the garbage business. However, today's waste...

Question