2-21-2011

2-21-2011 - 1. Which economy will grow faster: Count ry A...

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1. Which economy will grow faster: Country A with per capita income of $1,000 or Country B with per capita income of $10,000? Why could this prediction be wrong? 2. How will each of the following affect a country’s growth rate? a. An increase in the percent change of the population. b. An increase in the savings rate. c. An improvement in technology. d. The government passes a law extending the time frame in which the holder of a patent has sole ownership of a technological innovation. 3. Answer the following: a. How many years will it take for income to double if a country’s total income grows at 2%? 4%? 6%? b. If a country’s income doubles in 16 years, at what rate is it growing? c. In 2009 per capita output of the US was about $40,000. If real income is growing at 2% annual rate, what will be the per capita output in 36 years? In 72 years? d. If real income is rising at an annual rate of 4% per year and the population is growing at a rate of 1% per year, how many years will it take for per capita
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2-21-2011 - 1. Which economy will grow faster: Count ry A...

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