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ECO 301 Intermediate Macroeconomics, Spring 2010
Instructor: Yangyi Shan
Reminder: The 2
nd
midterm exam is on Thursday, March 25th in class time
Homework Assignment 4
Due Day: Tuesday, March 23, 2010 at the beginning of lecture
Instructions:
•
Please write your name, student ID and session number on the first page.
•
Please show your work.
•
Please put your answers in the order of the questions
•
Please staple your homework
1.
(15 points) Over the past twenty years an economy’s total output has grown from 1000 to
1300, its capital stock has risen from 2500 to 3250, and its labor force has increased from 500
to 575. All measurements are in real terms. Calculate the contributions to economic growth of
growth in capital, labor, and productivity, assuming that
3
.
0
=
K
a
and
N
a
= 0.7
2.
(40 points) An economy has the perworker production function
t
y
= 3
5
.
0
t
k
where
t
y
is output per worker and
t
k
is the capitallabor ratio. The depreciation rate is 0.1, and
the population growth rate is 0.05. Saving is
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 Spring '10
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