According to the "New" Theories of Economic Growth, Increasing Marginal

question 71

Multiple Choice

According to the "new" theories of economic growth, increasing marginal returns to capital investment is

• A)impossible because diminishing returns are unavoidable.
• B)impossible, and is thus a weak source of growth.
• C)possible after initial fixed costs of innovation have been borne.
• D)possible only if the capital is government- owned infrastructure.
• E)possible, but only in the early stages of innovation before imitators rush in to drive prices down.

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