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Chapter 9: Q.9.5 (page 189)

Evaluate whether the U.S. economy has entered a period of stagnant economic growth.

Short Answer

Expert verified

The U.S. economy has entered a period of stagnant economic growth.

Step by step solution

01

introduction

Stagnation means the time spans when there is practically no economic development. Lately, stagnation was seen in the world's most exceptional countries.

02

explanation

The primary drivers of stagnation are immaterial efficiency development coming about because of later advances, low development of capital and HR, negligible adjustments from human resources ventures, and development decreasing impact of administrative and administrative arrangements. The stale development rates in the U.S GDP demonstrate that the U.S economy has confronted stagnation.

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Most popular questions from this chapter

Consider the following table displaying annual growth rates for nations X,Yand Z, each of which entered2017 with real per capita GDP equal to$20,000.

a. Which nation most likely experienced a sizable earthquake in late 2017that destroyed a significant portion of its stock of capital goods, but was followed by speedy investments in rebuilding the nation's capital stock? What is this nation's per capita real GDP at the end of2020, rounded to the nearest dollar?

b. Which nation most likely adopted policies in 2017 that encouraged a gradual shift in production from capital goods to consumption goods? What is this nation's per capita real GDP at the end of 2020, rounded to the nearest dollar?

c. Which nation most likely adopted policies in 2017that encouraged a quick shift in production from consumption goods to capital goods? What is this nation's per capita real GDP at the end ofrole="math" localid="1651525075599" 2020 , rounded to the nearest dollar?

Suppose that during the next 10years, real GDP triples and population doubles in each of the nations in Problem 9-4.What will per capita real GDP be in each country after 10years have passed?

A nation's capital goods wear out over time, so a portion of its capital goods become unusable every year. Last year, its residents decided to produce no capital goods. It has experienced no growth in its population or in the amounts of other productive resources during the past year. In addition, the nation's technology and resource productivity have remained unchanged during the past year. Will the nation's economic growth rate for the current year be negative, zero, or positive?

The graph to the right shows a production possibilities curve for 2020 and two potential production possibilities curves for 2021, denoted2021A and2021B

a. Which of the labelled points corresponds to the maximum feasible 2020 production that is more likely to be associated with the curve denoted2021A ?

b. Which of the labelled points corresponds to the maximum feasible 2020 production that is more likely to be associated with the curve denoted2021B ?

Consider Figure 9-7, and suppose that we round the rate of growth of per capita real GDP experienced in the European Union between 1981 and 1990 to the nearest full percentage point. Based on the information in Table 9-3, by what percentage would per capita real GDP has increased between 1990 and 2020 if the economic growth rate will have remained at this rounded level?
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