What is desired capital stock?

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  • What is desired capital stock?


User cost - desired capital stock - investment problem Author: calpr0t Last modified by: calpr0t Created Date: 9/22/2014 10:27:00 AM Company: psu Other titles:
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Positive: 91 %
Suppose that the desired capital stock is given as: K* = 0.3Y/i r. Where Y = GDP, and i r is the real interest rate.
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Positive: 88 %

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The desired capital stock is the amount of capital that allows the firm to earn the largest possible profit. ... Answers to Homework Questions ...
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Positive: 91 %
The optimal (profit maximizing) capital stock and the desired investment function ...
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Positive: 86 %
If the substitution effect of the real interest rate on saving ... increase in the depreciation rate now has what effect on your desired capital stock ...
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Positive: 72 %
... the investment function will shift by a smaller amount than the interest rate- desired capital stock relationship. ...
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Positive: 49 %

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