New Growth Theory Proposes That Real GDP Per Person Grows

question 299

Multiple Choice

New growth theory proposes that real GDP per person grows because of ________ and that growth ________.

• A) the pursuit of profit; can persist indefinitely
• B) productivity shocks; can persist indefinitely
• C) technological change; can only increase above the subsistence level temporarily
• D) productivity shocks; occurs randomly

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Definitions:

Effective Interest Method

The effective interest method is a finance and accounting technique used to allocate loan or bond interest expense over the relevant period based on the loan's book value.

Journal Entry

A record in accounting that represents a transaction and shows the accounts affected and the amounts.

Sale

A transaction between two parties where the buyer receives goods, services, or assets in exchange for money or other forms of compensation.