The Behaviour of the Solow Residual Suggests That When Current

question 6

Multiple Choice

The behaviour of the Solow residual suggests that when current total factor productivity increases

• A) it becomes more difficult to predict future total factor productivity.
• B) future total factor productivity is also likely to increase.
• C) such increases are temporary, so we can draw no conclusions about the likely behaviour of future total factor productivity.
• D) future total factor productivity is likely to decrease.
• E) are typically temporary and have no influence on future levels of aggregate real GDP.

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Definitions:

Belongingness Needs

The innate human need to feel connected and accepted by others, often considered a fundamental human motivation.

Alderfer's Existence Needs

A component of Clayton Alderfer's ERG theory, focusing on the basic physical and material well-being requirements akin to Maslow's physiological and safety needs.

Maslow's

Relating to the hierarchy of needs theory developed by Abraham Maslow, which posits that human motivations are influenced by a progression of needs, starting from basic survival needs up to self-actualization.

Physiological Needs

Basic physical requirements for human survival, such as food, water, shelter, and clothing, that are essential to maintaining life.