If the National Saving Rate Increases, The

question 42

Multiple Choice

If the national saving rate increases, the:

• A) economy will grow at a faster rate forever.
• B) capital-labor ratio will increase forever.
• C) economy will grow at a faster rate until a new, higher, steady-state capital-labor ratio is reached.
• D) capital-labor ratio will eventually decline.

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Definitions:

Eon

The largest division of the geologic time scale; eons are divided into eras.

Mass Extinction

An event in which a significant, global decrease in the diversity and abundance of life occurs in a relatively short period of geological time.

Cretaceous Period

The geological time period between 145 and 66 million years ago, the last period of the Mesozoic Era, known for the extinction of dinosaurs and rise of flowering plants.

Pleistocene Epoch

A geological timeframe that lasted from about 2.6 million to 11,700 years ago, characterized by multiple ice ages and the evolution of modern humans.