İKTİSADA GİRİŞ II

The GDP is defined as the market value of all final goods and services produced within a country in a given period of time, say, in a year.

The GDP can rise from one year to the next for two different reasons: first of all, it can rise due to increases in the overall prices of goods and services in the economy
for the measurement period. Secondly, it can grow due to increases in the quantity of goods and services produced in the economy for the time period.

Factors of production are the inputs used in the production process. They are the physical capital (K), labor (L), natural resources (raw materials, land, energy, etc.) and the entrepreneurship.

The production function is an expression that relates the total output produced to the quantities of inputs used.

The marginal product of labor is the increase (change) in the output produced that results in one-unit increase (change) in labor input.

Supply shocks are the shocks that cause the change of an economy’s production function.

The United States has the highest rate of GPD with 52194.8858.

Zimbabwe has the lowest rate of GPD with 908.82998 in 2017.

The Assumptions of the Solow Growth Model

• The economy consists of one sector producing one good which is used for either investment or consumption,

• It is closed economy without government, • Since the economy is a closed one, then the

saving is equal to investment,
• The economy is always producing its

potential which is the full employment

level of output,
• In the model, the rate of technological

growth, population growth and the depreciation rate of capital are all determined exogenously.

Very High Ranked Countries

HDI - Very High (>0.8) The selected countries include: Norway, Australia, Switzerland, Denmark, Netherlands, Germany, Ireland, United States, Canada, New Zealand, Singapore, Hong Kong, Liechtenstein, Sweden, United Kingdom, Iceland, Russia.

Economic growth is the percentage increase in the gross domestic product of nation from a period to another period of time. Correct answer is A.

Economic growth is 10% and growth rate of population is also 10%. Correct answer is C.

The marginal product of capital is the change in output produced that results in one unit increase (change) in the capital stock. Correct answer is C.

The marginal product of labor is the increase (change) in the output produced that results in one-unit increase (change) in labor input. Correct answer is D.

The rule 70 says that; 70/0.70 = 100.

Correct answer is E.

The rule 70 says 70/0.10 = 700.

Correct answer is A.

In case of ignoring the depreciation rate in the Harrod–Domar model, the growth
equation can be represented as g = s / v. Correct answer is B.

The Assumptions of the Solow Growth Model:
• The economy consists of one sector producing one good which is used for either investment or consumption,
• It is closed economy without government,
• Since the economy is a closed one, then the saving is equal to investment,
• The economy is always producing its potential which is the full employment level of output,
• In the model, the rate of technological growth, population growth and the depreciation rate of capital are all determined exogenously.

Correct answer is C.

Golden Rule capital labor ratio refers to the level of the capital labor ratio that maximizes the consumption per worker in the steady state. Correct answer is D.

HDI - Very High (>0.8) The selected countries include: Norway, Australia, Switzerland, Denmark, Netherlands, Germany, Ireland, United States, Canada, New Zealand, Singapore, Hong Kong, Liechtenstein, Sweden, United Kingdom, Iceland, Russia. Correct answer is E.