Ask Question, Ask an Expert

+61-413 786 465

info@mywordsolution.com

Ask Business Management Expert

Consider a simplified RBC model. Production purely depends on the level of capital: Yt = F(Kt) = (1 + γ)Kt, where γ is a constant. There is no taxation (Yt = PrSt + Ct) and no government spending (Gt = 0). Assume that autonomous consumption is zero, so the consumption is proportional to output: Ct = b(Yt), where b is the marginal propensity to consume. Which of the following parameter specifications has to be true in order to have positive growth in the level of output?

Background info: (PrS=Private Savings, t=time) In the RBC model, private savings today at time (t) will drive capital tomorrow. If this does not sound familiar to you please do not try and answer it because you will get it wrong. please attach the steps in solving this 

A. γ > 0.

B. (1 - b)(1 + γ) > δ.

C. b + δ + γ > 0.

D. (1 - b)γ > b.

Business Management, Management Studies

  • Category:- Business Management
  • Reference No.:- M92257888
  • Price:- $10

Priced at Now at $10, Verified Solution

Have any Question?


Related Questions in Business Management

Explain the equity theory adams why would an administrative

Explain the Equity theory (Adams). Why would an administrative worker be better motivated by the Equity theory?

This is an internet search assignment know asking price

This is an internet search assignment. Know asking price, sales price and try to get the best residential data. Note, most counties have internet data on their assessor web sites. You can find these. Instruction: Go to t ...

Suppose the elasticity of money demand with respect to

Suppose the elasticity of money demand with respect to income is 2/3. If the money supply increases by 10% and output increases by 4.5%, while the real interest rate and the expected inflation rate are unchanged, then th ...

Subject computer architecture1 suppose the following

Subject Computer Architecture 1. Suppose the following loop iterates 89 times. Assume a 1-bit predictor is used. Calculate the prediction accuracy of this predictor. Assume the buffer contains 0 initially. 1000 Loop: fld ...

According to firestions tire recall case discuss and

According to Firestion's tire recall case, discuss and evaluate the role of leadership when commercial realities conflict with public concerns, ethical dilemmas that ensue for leaders in such situation and how you sugges ...

What is big datahow are facebook and other companies using

What is Big Data? How are Facebook and other companies using this data about you to make money and are you ok with it

For the following c statement what is the corresponding

For the following C statement, what is the corresponding RISC-V assembly code? Assume that the variables f, g, h, and i are given and could be considered integers as declared in a C program. Use a minimal number of assem ...

If average fixed costs are 97 and average variable costs

If Average Fixed Costs are 9.7 and Average Variable Costs are 9.6 at 3 units of output, what are Average Total Costs? i.e., what are Average Total Costs per unit at 3 units of output?

How would you define the ideal organizational

How would you define the ideal organizational culture?

What is the strategy adopted by breadtalk are they

What is the strategy adopted by BreadTalk? Are they succeeding or failing? Why?

  • 4,153,160 Questions Asked
  • 13,132 Experts
  • 2,558,936 Questions Answered

Ask Experts for help!!

Looking for Assignment Help?

Start excelling in your Courses, Get help with Assignment

Write us your full requirement for evaluation and you will receive response within 20 minutes turnaround time.

Ask Now Help with Problems, Get a Best Answer

Why might a bank avoid the use of interest rate swaps even

Why might a bank avoid the use of interest rate swaps, even when the institution is exposed to significant interest rate

Describe the difference between zero coupon bonds and

Describe the difference between zero coupon bonds and coupon bonds. Under what conditions will a coupon bond sell at a p

Compute the present value of an annuity of 880 per year

Compute the present value of an annuity of $ 880 per year for 16 years, given a discount rate of 6 percent per annum. As

Compute the present value of an 1150 payment made in ten

Compute the present value of an $1,150 payment made in ten years when the discount rate is 12 percent. (Do not round int

Compute the present value of an annuity of 699 per year

Compute the present value of an annuity of $ 699 per year for 19 years, given a discount rate of 6 percent per annum. As