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solong [7]
3 years ago
7

If output is given by a Cobb-Douglas production function, real GDP is growing at 4%, the capital to labor ratio is constant, and

the labor force is growing at 1.5%, what is the growth rate of the Solow residual
Business
1 answer:
omeli [17]3 years ago
8 0

Based on the capital to labor ratio and the labor force growth rate, the growth rate of the Solow residual is 2.5%.

<h3>What is the Solow Residual?</h3>

This is the part of the growth in real GDP that is not as a result of an increase in capital or labor. The capital remained at zero growth and the labor was growing at 1.5%.

The Solow residual growth rate will then be:

= Real GDP growth rate - Labor force growth

= 4% - 1.5%

= 2.5%

Find out more on the Solow model at brainly.com/question/15687941.

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MakerMan Manufacturing creates heavy-duty hand tools. It produces a new collapsible hammer called the SmackN’Stash. One of the f
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4 years ago
Qualification certification and credentialing personnel are part of which nims management.
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3 0
3 years ago
The income statement of Cullumber Co. for the month of July shows net income of $2,200 based on Service Revenue $6,100, Salaries
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Revenue                                                                      $6,800

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