- Now Suppose The Economy Experiences Permanently Faster Growth Of Its Popu Lation Higher N With The Same Labour Market 1 (308.99 KiB) Viewed 17 times
- Now Suppose The Economy Experiences Permanently Faster Growth Of Its Popu Lation Higher N With The Same Labour Market 2 (308.99 KiB) Viewed 17 times
- Now Suppose The Economy Experiences Permanently Faster Growth Of Its Popu Lation Higher N With The Same Labour Market 3 (308.99 KiB) Viewed 17 times
Now suppose the economy experiences permanently faster growth of its popu- lation (higher n) with the same labour-market participation rate p. (e) [3 marks] Use the diagram from part (a) to find the long-run effects on the levels of y and ÿ. (f) [3 marks] Suppose owners of capital receive an income equal to the marginal product of capital minus the depreciation rate per unit of capital. Explain whether they gain or lose in the long run from the increase in population growth analysed in part (e).
Now suppose the economy experiences permanently faster growth of its popu- lation (higher n) with the same labour-market participation rate p. (e) [3 marks] Use the diagram from part (a) to find the long-run effects on the levels of y and ÿ. (f) [3 marks] Suppose owners of capital receive an income equal to the marginal product of capital minus the depreciation rate per unit of capital. Explain whether they gain or lose in the long run from the increase in population growth analysed in part (e).