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Holding technology and human capital fixed in Techland, increasing physical capital per worker
from $25,000 to $100,000 would have led to a doubling of real GDP per worker, from $40,000
to $80,000 during the 1970 to 2005 period. However, not only did physical capital per worker
increase from $25,000 to $100,000, but technological progress shifted the productivity curve
upward so that the actual increase in real GDP per worker during the 1970 to 2005 period was
from $40,000 to $320,000.


What was the
growth rate of real GDP per capita in Techland attributable to higher total factor
productivity during the 1970 to 2005 period?
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16. In the closed economy of Sildavia, government spending during 2005 was $30 billion,
government transfers were $15 billion, consumption was $70 billion, taxes were $35
billion, and GDP was $110 billion. If investment spending in Sildavia during 2005 was
$10 billion, we can conclude that:
A) net savings were equal to $0.
B) private savings were equal to $10 billion.
C) the government's budget balance was equal to -$10 billion.
D) all of the above are correct.
E) none of the above is correct.
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