The Behavior of the Solow Residual Suggests That When Current

question 15

Multiple Choice

The behavior 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 behavior of future total factor productivity.
• D) future total factor productivity is likely to decrease.

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