The Solow Growth Model Shows That the Growth Rate of Real

question 27

Multiple Choice

The Solow growth model shows that the growth rate of real GDP per worker depends on:

• A)the saving rate, s
• B)the growth rate of the labour force, n.
• C)the depreciation rate, .
• D)all of the above.

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Definitions:

Gross National Income

The total domestic and foreign output claimed by residents of a country, including wages, salaries, and property income.

Gross Domestic Product

The sum value in currency or market terms of every finished product and service created within a country during a specified period.

Economic Growth

An increase in the production of goods and services in an economy over a period of time, often measured by GDP growth.

Private Consumption

The spending on goods and services by households for their own use.