User Account

All Pages

What level of investment maximizes the steady state rate

Assignment Help Microeconomics
Reference no: EM13887672

The steady state level of consumption in an economy (Css) is equal to steady state out- put (Yss) minus steady state depreciation. The latter is the depreciation rate (d) times the steady state capital stock (Kss). We assume here that there is no technological progress. Thus
Css = Yss - d Kss

What is the impact on steady state consumption of a small increase in the steady state capital stock? What level of investment maximizes the steady state rate of consumption?

Reference no: EM13887672

Questions Cloud

Explain the american system and its benefits : Explain the "American System" and its benefits
Hessian matrix of second order partial derivatives : Hessian matrix of second order partial derivatives for f(x1,x2)=x1^(1/4) x2^(1/3) for x1, x2>0 is negative definite.
How many periods would it take for an economy : Use the Cobb-Douglas production function of question 1 where a = 0.3 and a deprecia- tion rate of 0.1. Examine the steady state outcomes of an economy that invests 20% and 30% of GDP.
What is the federal funds rate : What is the federal funds rate and how does it impact the Fed and the economy overall?
What level of investment maximizes the steady state rate : What is the impact on steady state consumption of a small increase in the steady state capital stock? What level of investment maximizes the steady state rate of consumption?
Calculate in dollar terms : Assume the United States exports 1,000 computers costing $3,000 each and imports 150 UK autos at a price of £10,000 each. Assume that the dollar/pound exchange rate is $2 per pound.Calculate in dollar terms, the U.S. export receipts, import payments,..
To what extent each donation is deductible on her schedule a : Diane Bauman, a professional artist with AGI in excess of $75,000, made the following donations. Determine to what extent each donation is deductible on her Schedule A. a. $2,000 cash to the First Methodist Church of Chicago. b. $50 cash to a homeles..
The second order partial derivative f21 : If a function f(x1,x2) is not additively separable, then the second order partial derivative f12 will be different from the second order partial derivative f21? True or False?
Where investors will place their funds : Consider separately the case of decreasing, constant, and increasing marginal product of capital and where investors can either invest in a bank account and earn interest rate R or invest in the capital stock of a country.

Reviews

Write a Review

Microeconomics Questions & Answers

  Explain comparative advantage of in the production of corn

felix and kim are farmers.each one owns 5 acres of land the following table shows the amount of corn and alfelfa each farmer can produce on any given acre. both farmers can chose wheater to devot 5 acres for producing corn only, alfelfa only,or to..

  To decide the amount of state income tax

RedBall Productions is a new company based in Orem, Utah.RedBall supplies stock images of still photography.

  Derivatives problem

Consider an economy in three periods, t = 0, t = 1 and t = 2. At t = 0, the market index is trading at a value of 100. At t = 1, the index either rises to 125 with 50 percent probability, or falls to 90 with 50 percent probability. Find the price you..

  Kind of skills and education that young men should have

The Kind of Skills and Education that our Young Men and Women Should Have in order to Fill the Jobs of the Future

  Appraise baumols sales revenue maximazation theory

Appraise baumols sales revenue maximazation theory as an alternative of the firm

  The state of washington

I. Suppose that the State of Washington (that is, the median voter in Washington) has the following preferences of Education E and other goods G: U(G, E) = α ln G + (1 - α) ln E The price of education is PE; the price of other goods is 1; the state' ..

  How much will the firms total revenues revenues from both

you are the manager of a firm that receives revenues of 50000 per year from product x and 90000 per year from product

  Calculate the new demand for dollars at each exchange rate

Suppose the demand for dollars increases by 300 billion at each exchange rate. Explain if the increase in demand results from a large purchase b the Chinese of a new American-made airplane or a large purchase by Americans of new lower priced Chinese-..

  Balance depreciation is utilized for material handling lift

For depreciation purposes, a 150% declining balance depreciation is utilized for a material handling lift truck with a cost basis of $21,668 and a salvage value of $6250 at the end of its useful life of five years. If the MACRS depreciation method wi..

  Compute the break-even rate for the options hedge

Raider Inc., an American importing firm anticipates an outflow of ¥893 million in 6 months. Raider's management team is worried about the course of the ¥/$ exchange rate over the next 6 months and decides to hedge.

  Describe likely effects on the total welfare

Describe the likely effects on the total welfare (surplus) of society of the status quo, i.e., do nothing and let the market decide.

  What is the composition of gdp by percentage

What is Country A's GDP, what is the composition of GDP by percentage, what is the GDP per capita and how does this relate to Keynesian economics?

Free Assignment Quote

Assured A++ Grade

Get guaranteed satisfaction & time on delivery in every assignment order you paid with us! We ensure premium quality solution document along with free turntin report!

Submit Assignment

Academics

Major Subjects

Majors

Get In Touch

whatsapp: +1-415-670-9521

Phone: +1-415-670-9521

Email: [email protected]

TERMS & POLICIES

HELP & SUPPORT

All rights reserved! Copyrights ©2019-2020 ExpertsMind IT Educational Pvt Ltd