Neoclassical Growth Theory Is Based on the Proposition That Real

question 270

Multiple Choice

Neoclassical growth theory is based on the proposition that real GDP per person grows when

• A) the population growth rate decreases.
• B) technological advances occur.
• C) the population growth rate increases.
• D) saving decreases.

---

Definitions:

Depreciation Expense

It is an accounting method of allocating the cost of a tangible asset over its useful life.

Residual Value

The estimated amount that an asset will realize upon its disposal at the end of its useful life.

Straight-Line Depreciation

A method of calculating the depreciation of an asset evenly over its useful life, assigning a fixed expense amount to every accounting period.

Fixed Asset

A durable, physical asset that a company possesses and employs in its business activities to produce revenue.