In the Romer Model, Output Is Increasing in ________ and Decreasing

question 69

Multiple Choice

In the Romer model, output is increasing in ________ and decreasing in ________.

• A) the saving rate; the depreciation rate
• B) the research share; the growth rate of knowledge
• C) the growth rate of knowledge; the fraction of population in the ideas sector
• D) the growth rate of knowledge; the depreciation rate
• E) the saving rate; the growth rate of knowledge

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Definitions:

Interest Rate

The proportion of a loan charged as interest to the borrower, typically expressed as an annual percentage of the loan outstanding.

Short-term Investments

Assets intended to be converted into cash or sold within a year.

Current Ratio

A financial metric that measures a company's ability to pay off its short-term liabilities with its short-term assets.

Liquidity

The ease with which an asset or security can be converted into ready cash without affecting its market price.