Suppose That a Technological Advance Raises Total Factor Productivity

question 30

Essay

Suppose that a technological advance raises total factor productivity.Explain,step-by-step,how the economy adjusts to arrive at a new long-run equilibrium.

---

Definitions:

High Dividend Payout

The practice of distributing a large portion of a company's earnings to its shareholders in the form of dividends.

Distribution

The process of allocating assets, earnings, or dividends among shareholders, or the spread of investments within a portfolio.

Corporate Dividend Payout

The portion of earnings distributed to shareholders in the form of dividends.

Firm's Earnings

The profit of a company after all expenses and taxes have been deducted from revenue, indicating the company’s financial performance over a specified period.