A Country Has the Per-Worker Production Function Yt = 5kt⁰

question 35

Essay

A country has the per-worker production function yt = 5kt⁰.⁵,where yt is output per worker and kt is the capital-labour ratio.The depreciation rate is 0.2 and the population growth rate is 0.05.The saving function is St = 0.2yt,where St is total national saving and yt is total output.
a.What is the steady-state value of the capital-labour ratio?
b.What is the steady-state value of output per worker?
c.What is the steady-state value of consumption per worker?

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Definitions:

Bureaucratic Features

Characteristics of a bureaucratic organization include a hierarchical structure, formal rules and regulations, specialization, and an impersonal relationship between its members.

Worker Empowerment

The practice of giving employees the authority, resources, and freedom to make decisions and contribute to the company's success in meaningful ways.

Organic Design

An organization structure that is decentralized, with fewer rules and procedures, open divisions of labour, wide spans of control, and more personal coordination.

Informal Structures

The unofficial relationships and dynamics within an organization that influence how work gets done outside of formal processes and hierarchies.