Chapter 6: Long Run Economic Growth Flashcards Preview

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Flashcards in Chapter 6: Long Run Economic Growth Deck (2)
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1
Q

State an equation that represents output as a function of productivity, capital and labor.

A

Y=AF(K,N), if A, K, and N are constant, then output is also constant.

2
Q

Recall the growth accounting equation

A

Change in Y = Change in A + ak Change in K + aN Change in N
ak= elasticity of output with respect to capital
an= elasticity of output with respect to labor