Classical Growth Theory Predicts That

question 144

Multiple Choice

Classical growth theory predicts that

• A) the supply of labor decreases as real wage rates rise.
• B) technological progress increases the demand for labor, driving up real wage rates, and then population growth rises, driving down real wage rates to their subsistence level.
• C) technological progress increases the demand for labor, driving down real wage rates, and then population growth rises, driving up real wage rates to their subsistence level.
• D) technological progress decreases the demand for labor.

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