Assume that the hypothetical economy of Molpol has 8 workers in year 1, each wor

Question

Assume that the hypothetical economy of Molpol has 8 workers in year 1, each working 1,200 hours per year (40 weeks at 30 hours per week). The total input of labor is 9,600 hours. Productivity (average real output per hour of work) is $10 per worker Instructions: In parts a and b, round your answers to the nearest whole number. In part c, round your answer to 2 decimal places. a. What is real GDP in Molpol? Suppose work hours rise by 2 percent to 9,792 hours per year and labor productivity rises by 5 percent to $10.5 b. In year 2, what will be Molpol's real GDP? c. Between year 1 and year 2, what will be Molpol's rate of economic growth? percent

Explanation / Answer

a. The real GDP is $96,000 (= 9,600 multiplied by $10).

b. In year 2, the real GDP is $102,816 (= 9,792 multiplied by $10.5).

c. Between year 1 and year 2, the rate of economic growth is 7.1 percent. [= 100(102,816 - 96,000)/96,000].

Related Questions

Navigate

• Browse (All)
• Browse A
• Subjects

---

---

Integrity-first tutoring: explanations and feedback only — we do not complete graded work. Learn more.