The Golden Rule Savings Rate Is Achieved When Capital Is

question 36

Multiple Choice

The golden rule savings rate is achieved when capital is accumulated at a rate that

• A) maximizes consumption per worker in the steady state.
• B) keeps consumption per worker constant in the steady state.
• C) population growth exceeds the depreciation rate.
• D) minimizes the effects of consumption growth on population growth.
• E) minimizes consumption per worker in the steady state.

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Definitions:

Economic Growth

An increase in the production of goods and services in an economy over a period, often measured by GDP growth.

Budget Deficits

The situation that occurs when a government spends more money than it receives in revenue over a specific period of time.

Federal Budget Deficits

The financial situation where the U.S. government's expenditures exceed its revenues within a fiscal year.

National Debt

The total amount of money that a country's government has borrowed by issuing securities, mostly through the sale of bonds.