According to the Solow Growth Theory,developing Nations Will Catch Up

question 161

Multiple Choice

According to the Solow growth theory,developing nations will catch up to the developed nations

• A) if developing nations become more politically stable.
• B) if developing nations invest in more education for their workers.
• C) because developing nations can borrow technologies from the developed nations and learn from their mistakes.
• D) in about 100 years.
• E) at no foreseeable time in the future.

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Definitions:

Equity Multiplier

The equity multiplier is a financial ratio that measures the proportion of a company's total assets financed by its shareholders' equity.

Price-earnings Ratio

A valuation metric for stocks, calculated by dividing the current market price of a stock by its earnings per share (EPS).

Debt-to-equity Ratio

A financial ratio indicating the relative proportion of shareholders' equity and debt used to finance a company's assets, typically used to assess leverage and financial health.

Times Interest

A financial ratio, also known as interest coverage ratio, that measures a company's ability to meet its interest payments on outstanding debt.