The Catch-Up Effect Refers to the Idea That

question 181

Multiple Choice

The catch-up effect refers to the idea that

• A)saving will always catch-up with investment spending.
• B)it is easier for a country to grow fast and so catch-up if it starts out relatively poor.
• C)population eventually catches-up with increased output.
• D)if investment spending is low, increased saving will help investment to "catch-up."

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Definitions:

Annual Output

The aggregate sum of products and services generated by an economy or company within a single year.

Standard of Living

A measure of the economic welfare and the quality of life of a population, based on income, employment, class disparity, poverty rate, and housing affordability.

Productivity

The efficiency of production measured by the output per unit of input.

Standard of Living

The measure of fiscal prosperity, convenience, material assets, and critical needs granted to a select socioeconomic layer or specific geographic territory.