Refer to the scenario above. If both economies have the same depreciation rate, then which of the following statements will be true?
A) Economy A will have a greater capital stock and a lower GDP than economy B.
B) Economy A will have a greater capital stock and GDP than economy B.
C) Economy A will have a lower capital stock and GDP than economy B.
D) Economy A will have a lower capital stock and a greater GDP than economy B.
B
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If the interest rate on euro-denominated assets is 13 percent and it is 15 percent on peso-denominated assets, and if the euro is expected to appreciate at a 4 percent rate,
for Manuel the Mexican the expected rate of return on euro-denominated assets is A) 11 percent. B) 13 percent. C) 17 percent. D) 19 percent.
Suppose the production function for a certain device is q = L + K. If neutral technical change has occurred, which of the following could be the new production function?
A) q = L + 5K B) q = 5 ? (L + K) C) q = 5L + K D) All of the above are possible.