According to the Solow Model, in the Steady State, Countries

question 7

Multiple Choice

According to the Solow model, in the steady state, countries with high saving rates should have a:

• A) low labor-output ratio.
• B) low capital-output ratio.
• C) high capital-output ratio.
• D) high depreciation rate.
• E) high A.

---

Definitions:

Resource Demand

The need or desire for specific resources in order to produce goods or services within an economy.

Product Market

The market where end products or services are made available to consumers, businesses, and governmental bodies.

Determining Factors

Key elements that significantly influence the outcome or condition of a specific situation or context.

MRP

Marginal Revenue Product; the additional revenue generated by employing one more unit of a factor, like labor or capital.