If the Depreciation and Saving Rates Are Constant, the Economy

question 111

Multiple Choice

If the depreciation and saving rates are constant, the economy eventually will reach the steady state in the Solow model because of:

• A) the lack of productivity.
• B) increasing returns to capital in production.
• C) constant returns to capital in production.
• D) diminishing returns to capital in production.
• E) increasing returns to labor in production.

---

Definitions:

Fraud

Fraud is a deliberate act of deception intended for personal gain or to cause a loss to another party, often involving financial transactions.

Cash Equivalents

Investments of a short-term nature that are both easily converted into precise cash amounts and carry a minimal risk of fluctuating in value.

IFRS

Stands for International Financial Reporting Standards, which are designed to make company accounts understandable and comparable across international boundaries.

Highly Liquid Investments

Investments that can easily and quickly be converted into cash with little loss of value.