With Population Growth at Rate N and Labor-Augmenting Technological Progress

question 96

Multiple Choice

With population growth at rate n and labor-augmenting technological progress at rate g, the Golden Rule steady state requires that the marginal product of capital (MPK) :

• A) net of depreciation be equal to n + g.
• B) net of depreciation be equal to the depreciation rate plus n + g.
• C) plus n be equal to the depreciation rate plus g.
• D) plus g be equal to the depreciation rate plus n.

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Definitions:

Net Assets

The difference between total assets and total liabilities, representing the owner's or shareholders' equity in a company.

Cost

The amount of money required to purchase something or the expense associated with creating a product or service.

Selling Price

The amount of money for which a product is sold to the consumer.

Completed-Contract Method

An accounting strategy where revenue and expenses of a long-term project are deferred until the project is completed, at which point they are recognized in the fiscal period of completion.