6. If initial K = 750, d = .1, and I = 150, what is the...

6. If initial K = 750, d = .1, and I = 150, what is the value of K in period t+1? _______

7. Using the data in problem 6, what is K in period t+5? ______

8. In the steady state, if Y = 500 and s=.1, C is? ________

9-10. (2 points). Draw the graph of the Solow model for a decrease in the investment rate, showing

the move to the new steady state.

Expert Solution

6) Capital stock is 750. Depreciation is 0.1 or 10% which is 75. Investment is 150. Hence capital in next period (t + 1) = 750 + 150 - 75 = 825

7) K t + 5 is 1057.10.

This is done in the table below. For example, K in t + 3 will be K in t + 2 = 892.50, added with investment +

150 and subtracted depreciation 0.1*(K t) = 0.1*825 = 82.5. This gives K in t + 3 = 953.3.

Time	Capital stock	Investment	Depreciation	Addition to capital
0	750	150.0	75.0	75.0
1	825.0	150.0	82.5	67.5
2	892.5	150.0	89.3	60.8
3	953.3	150.0	95.3	54.7
4	1007.9	150.0	100.8	49.2
5	1057.1	150.0	105.7	44

8) Y is 500 and saving rate is s = 0.1. This implies savings are 0.1 x 500 = 50. Hence C = Y - S = 500- 50 = 450

9) The graph is shown below. As the investment rate (saving rate) declines, the investment function shifts down. The new steady state is lower than the original steady state of capital per worker.

Rahul Sunny answered 2 years ago

Consider the following competetive economy K=150 L=150 Production Function= Y=K^.4L^.6 Consumption Function . C=10+.7Yd I= 40-100R,...

Consider the following competetive economy K=150 L=150 Production Function= Y=K^.4L^.6 Consumption Function . C=10+.7Yd I= 40-100R, G=30, T=30 .... MPL= .6K^.4L^-.4 MPK= .4K ^-.6L^.6 Find competetive EQM by leaving out goods market in your initial computations. b) Use national savings (S) and the investment function (I) to determine the real interest rate (r). Draw the graph of the Loanable Funds Market showing the supply of loanable funds, demand for loanable funds, and the equilibrium price and quantity. (Labor Graph carefully)...

Radioactivity lab using equation age=1/k ln(1+D/P) k=decay constant; D= # of daughter atoms in sample (beans);...

Radioactivity lab using equation age=1/k ln(1+D/P) k=decay constant; D= # of daughter atoms in sample (beans); P= # of parent atoms in sample (M&M's) if you found a container with 20 M&M's and 50 pinto beans, how old would you estimate the sample to be

Consider the group G = {1, −1, i, −i, j, −j, k, −k} under multiplication. Here...

Consider the group G = {1, −1, i, −i, j, −j, k, −k} under multiplication. Here i2= j2= k2= ijk = −1. determine which of the following sets is a subgroup of G. If a set is not a subgroup, give one reason why it is not. (a) {1, −1} (b) {i, −i, j, −j} (c) {1, −1, i, −i} (d) {1, i, −i, j}

Rate of return=[Initial value(Current value−Initial value)]×100 where can I find that Form 10-K. What numbers would...

Rate of return=[Initial value(Current value−Initial value)]×100 where can I find that Form 10-K. What numbers would I be looking at? Can you please provide examples. Thanks

1a) Let S = $55, K = $50, r = 6% (continuously compounded), d = 2%,...

1a) Let S = $55, K = $50, r = 6% (continuously compounded), d = 2%, s = 40%, T = 0.5, and n = 5. In this situation, the appropriate values of u and d are 1.13939 and 0.88471, respectively. What is the value of p*, the risk-neutral probability of an upward movement in the stock price at any node of the binomial tree? Answers: a. 0.5316 b. 0.4998 c. 0.3738 d. 0.4146 e. 0.4684 1b) Let S =...

Treatment of a polypeptide with Tris-(2-carboxyethyl)-phosphine hydrochloride (TCEP) yields two peptides: 1. I-Q-K-H-C-R-C-A-K-M-V-S 2. F-C-R-L-K-D-C-K-N-D Treatment...

Treatment of a polypeptide with Tris-(2-carboxyethyl)-phosphine hydrochloride (TCEP) yields two peptides: 1. I-Q-K-H-C-R-C-A-K-M-V-S 2. F-C-R-L-K-D-C-K-N-D Treatment of the intact polypeptide with Trypsin yields fragments with the following amino acid composition: (Ser, Met, Val) (Lys, Gln, Ile) (Phe, Ala, Cys2, Arg, Lys) (Asp, Asn) (Leu, Lys) (Lys, His, Asp, Cys2, Arg) a) The intact (untouched) polypeptide is labeled with 1-Fluoro-2,4-dinitrobenzene (FDNB) labeling, followed by acid hydrolysis. What will be observed? b) Name and briefly describe a method which may determine if...

Let W be a discrete random variable and Pr(W = k) = 1/6, k = 1,...

Let W be a discrete random variable and Pr(W = k) = 1/6, k = 1, 2 ,....., 6. Define X = { W, if W <= 3; 1, if W >= 4; } and Y = { 3, if W <= 3; 7 -W, if W >= 4; } (a) Find the joint probability mass function of (X, Y ) and compute Pr(X +Y = 4). (b) Find the correlation Cor(X, Y ). Are X and Y independent? Explain.

A 8.6-kg cube of copper (cCu = 386 J/kg-K) has a temperature of 750 K. It...

A 8.6-kg cube of copper (cCu = 386 J/kg-K) has a temperature of 750 K. It is dropped into a bucket containing 5.1 kg of water (cwater = 4186 J/kg-K) with an initial temperature of 293 K. 1) What is the final temperature of the water-and-cube system? K 2) If the temperature of the copper was instead 1350 K, it would cause the water to boil. How much liquid water (latent heat of vaporization = 2.26 × 106 J/kg) will...

Consider the following reaction at 309 K. 1 A + 1 B → C + D...

Consider the following reaction at 309 K. 1 A + 1 B → C + D where rate = rate=k[A]2[B]. An experiment was performed for a certain number of seconds where [A]o = 1.07 M and [B]o = 0.000167 M. A plot of ln[B] vs time had a slope of -9.63. What will the rate of this reaction be if a new experiment is preformed when [A] = [B] = 0.212 M?

Assume the demand function is D(p) = 150 – 5p (p is price). a. What is...

Assume the demand function is D(p) = 150 – 5p (p is price). a. What is the slope? 5(30-p) Oe=150-5p p=30 b. What is the y-intercept = 180 c. Using the definition of slope what does the demand do as price increases ∆푦 ∆푥 by $1? Demand will decrease by 2 d. Graph the function (p is on the x-axis, D(p) is on the y-axis). Hint: all you need are the x-intercept (set D(p) = 0 and solve for p)...

Question