# Answer4 - ECO 301 Intermediate Macroeconomics Spring 2010...

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ECO 301 Intermediate Macroeconomics Spring 2010 Instructor: Yangyi Shan Homework Assignment 4 Answer Key 1. (15 points) 20 Years Ago Today Percent Change Y 1000 1300 30% K 2500 3250 30% N 500 575 15% A / A = Y / Y a K K / K a N N / N = 30% – (0.3 × 30%) - 0.7 × 15% = 30% – 9% – 10.5% = 10.5% Capital growth contributed 9% ( a K K / K ), labor growth contributed 10.5% ( a N N / N ), productivity growth was 10.5%. 2. (40 points) (a) sf ( k ) = ( n + d ) k 0.3 × 3 k .5 = (0.05 + 0.1) k 0.9 k .5 = 0.15 k 0.9/0.15 = k / k .5 6 = k .5 k = 6 2 = 36 y = 3 k .5 = 3 × 6 = 18 c = y – ( n + d ) k = 18 – (0.15 × 36) = 12.6 (b) sf ( k ) = ( n + d ) k 0.4 × 3 k .5 = (0.05 + 0.1) k 1.2 k .5 = 0.15 k 1.2/0.15 = k / k .5 8 = k .5 k = 8 2 = 64 y = 3 k .5 = 3 × 8 = 24 c = y – ( n + d ) k = 24 – (0.15 × 64) = 14.4 (c) sf ( k ) = ( n + d ) k 0.3 × 3 k .5 = (0.08 + 0.1) k 0.9 k .5 = 0.18 k 0.9/0.18 = k / k .5 5 = k .5 k = 5 2 = 25 y = 3 k .5 = 3 × 5 = 15

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c = y – ( n + d ) k = 15 – (0.18 × 25) = 10.5 (d) sf ( k ) = ( n + d ) k 0.3 × 4 k .5 = (0.05 + 0.1) k 1.2 k .5 = 0.15 k 1.2/0.15 = k / k .5 8 = k .5 k = 8 2 = 64 y = 4
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## This note was uploaded on 05/05/2010 for the course COM 4123 taught by Professor Ted during the Spring '10 term at SUNY Albany.

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Answer4 - ECO 301 Intermediate Macroeconomics Spring 2010...

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