Suppose That a Country Increased Its Saving Rate

question 73

Multiple Choice

Suppose that a country increased its saving rate.In the long run it would have

• A)higher productivity,and another unit of capital would increase output by more than before.
• B)higher productivity,but another unit of capital would increase output by less than before.
• C)lower productivity,and another unit of capital would increase output by more than before.
• D)lower productivity,but another unit of capital would increase output by less than before.

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Definitions:

Short Run

In economics, a period during which at least one factor of production is fixed and cannot be changed, limiting adjustments to changes in demand or technology.

Average Total Cost

The total cost of production (fixed and variable costs) divided by the number of units produced, indicating the cost per unit of output.

Specialization

A strategy where individuals or entities concentrate on a narrow range of production tasks, aimed at increasing efficiency and expertise.

Quantity Discounts

Price reductions based on the amount of a product purchased, incentivizing buyers to purchase in larger volumes.