In Classical Growth Theory, If the Income Level Is Above

question 113

Multiple Choice

In classical growth theory, if the income level is above the subsistence income,

• A) the economy will keep growing without limit.
• B) population grows and lowers real income to its subsistence level.
• C) technological growth occurs and keeps real income above its subsistence level.
• D) the pursuit of profit will cause economic growth to accelerate.
• E) None of the above is correct because the classical growth theory asserts that income can never exceed the subsistence level.

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