The growth accounting equation suggests that the growth rate of output is equal to the growth...

The growth accounting equation suggests that the growth rate of output is equal to the growth rate of ________.

A. total factor productivity plus the contributions of both capital and labor
B. total factor productivity minus the rate of depreciation
C. capital and labor
D. the overall population
E. none of the aboveIf productivity growth equals 3.0 percent, the contribution from capital growth 1.2 percent and the contribution from labor growth 2.0 percent, then output growth must equal ________.
A. 2.2 percent
B. 4.2 percent
C. 6.2 percent
D. 7.2 percent
E. 9.1 percent

Expert Solution

1]

Correct option: A] total factor productivity plus the contributions of both capital and labor

The growth accounting equation suggests that the growth rate of output is equal to the growth rate of total factor productivity plus the contributions of both capital and labor.

2]

Output growth = productivity growth + contribution from capital + contribution from labor growth

= 3.0 + 1.2 + 2.0 = 6.2 %

Correct option: C] 6.2 percent

Rahul Sunny answered 2 years ago

The dividend-growth model, suggests that an increase in thedividend growth rate will increase the value...

The dividend-growth model, suggests that an increase in the dividend growth rate will increase the value of a stock. However, an increase in the growth may require an increase in retained earnings and a reduction in the current dividend. Thus, management may be faced with a dilemma: current dividends versus future growth. As of now, investors’ required return is 10 percent. The current dividend is $0.9 a share and is expected to grow annually by 5 percent, so the current...

The relationship between the dividends, retained earnings and a firm's growth rate suggests that firms can...

The relationship between the dividends, retained earnings and a firm's growth rate suggests that firms can increase their stock price by increasing its plowback ratio. However, in reality we do not observe firms do this. Moreover, over the past decade we have seen firms disgorging their cash in the form of share repurchases. Why do you think firms are not plowing back more money into their firms?

Actual output is equal to 6,000 and potential output is 8,000. the multiplier is currently equal...

Actual output is equal to 6,000 and potential output is 8,000. the multiplier is currently equal to 5. Using this data government purchases will need to ___ in order to eliminate the output gap. A) increase by 4000 B) decrease by 200 C) increase by 400 D) decreases by 2,000

explain what the accounting equation really means beyond the one side should equal the other

For any given level of output, Y, find an equation that gives the real interest rate,...

For any given level of output, Y, find an equation that gives the real interest rate, r, that clears the goods market; this equation describes the IS curve. [Hint: Write the goods market equilibrium condition and solve for r in terms of Y and other variables.]

1-Using Solow Model of growth explain the impact of changes in saving rate ono output and...

1-Using Solow Model of growth explain the impact of changes in saving rate ono output and consumption? And differentiate between the Solow Model and Ramsey-Cass-Koopmans model of growth. Also explain the behavior of c and k for various initial values of c?

What do you mean by the Cost Accounting? 1. Cost Accounting: As the name suggests, this...

What do you mean by the Cost Accounting? 1. Cost Accounting: As the name suggests, this type of a product, so that the management can exercise its control accounting is mainly related with the ascertainment of the costin order to minimize the costs and maximize the profits. 2. Cost Accounting: This type of of a product, so that the management cannot exercise its control accounting is mainly related with the ascertainment of the costin order to minimize the costs and...

What is the accounting equation?

What is accounting equation? Give any five transaction and there treatment in accounting equation?

Payback Period and Accounting Rate of Return: Equal Annual Operating Cash Flows with Disinvestment Roopali is...

Payback Period and Accounting Rate of Return: Equal Annual Operating Cash Flows with Disinvestment Roopali is considering an investment proposal with the following cash flows: Initial investment-depreciable assets $125,000 Initial investment-working capital 19,000 Net cash inflows from operations (per year for 12 years) 18,000 Disinvestment-depreciable assets 14,000 Disinvestment-working capital 2,000 For parts b. and c., round answers to three decimal places, if applicable. a. Determine the payback period. Answer years b. Determine the accounting rate of return on initial investment...

Question