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In Country Z, physical capital per worker is $16,200, while GDP is $550 billion. The rate of investment is 20%, but only 33% of all the investments goes toward acquiring new physical capital. The country has 44 million workers.


Assuming that GDP and quantity of workers stay the same, calculate the value of physical capital per worker next year. Enter your answer in the box below. Throughout your calculations, round to one decimal place; for the final answer, round to the nearest whole number.

Answer :

Rounding the final answer to the nearest whole number, the value of physical capital per worker next year is approximately $17,025.

To calculate the value of physical capital per worker next year, we need to consider the rate of investment and the allocation of that investment towards acquiring new physical capital. Let's break it down step by step:

1. Find the total investment amount:
- The rate of investment is 20%, which means that 20% of the GDP is invested.
- Multiply the GDP by the rate of investment: $550 billion x 0.20 = $110 billion.

2. Determine the investment in new physical capital:
- Only 33% of all the investments goes toward acquiring new physical capital.
- Multiply the total investment amount by the percentage allocated to new physical capital: $110 billion x 0.33 = $36.3 billion.

3. Calculate the change in physical capital per worker:
- Divide the investment in new physical capital by the number of workers: $36.3 billion / 44 million = $825 per worker.

4. Calculate the physical capital per worker next year:
- Add the change in physical capital per worker to the initial physical capital per worker.
- Initial physical capital per worker is $16,200, so $16,200 + $825 = $17,025.



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