05 Jun Question A. A1. What is a production funct
Question
A. A1. What is a production function? Write an equation for a typical production function, and explain what each of the terms represents (4 MARKS). A2. A puzzle: The share of GDP devoted to investment was similar for Canada and South Korea over the period 1960–1990. However, South Korea had a 7 percent growth rate of average annual income, while Canada had only a 2.5 percent growth rate. How can this be explained? (4 MARKS). A3. What are the basic differences between bonds and stocks? (4 MARKS). A4. Which of the two bonds in each example would you expect to pay the higher interest rate? Explain why. a. a Canadian government bond or a Brazilian government bond b. a government of Canada bond or a municipal bond of the same face value and term c. a 6-month Treasury bill or a 20-year bond d. a Canadian National Railway Company bond or a bond issued by a new record company (4 MARKS) A5. Question 6, ch 5. Pp. 122. 9 Marks (PLEASE SEE THE TEXTBOOK) C. CHAPTER 8. QUESTIONS 1, 11 AND 12. PAGE 192
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