Starting from a Steady-State Situation, If the Saving Rate Increases

question 3

Multiple Choice

Starting from a steady-state situation, if the saving rate increases, the rate of growth of capital per worker will:

• A)increase and continue to increase unabated.
• B)increase until the new steady state is reached.
• C)decrease until the new steady state is reached.

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Definitions:

Standard Deviation

An analysis tool for the variation or dispersal range within a collection of figures.

Population Mean

The average value of a set of characteristics for the entire population, calculated as the sum of all values divided by the number of values.

Level of Confidence

The degree of certainty or trust one can have in the interval estimate of a population parameter.

Confidence Interval

A range of values, derived from sample data, that is likely to contain the population parameter of interest with a specified probability.