In the Solow Model,the Faster Growth of Output That Results

question 65

Multiple Choice

In the Solow model,the faster growth of output that results from an increase in the saving rate is temporary,because ________.

• A)of diminishing marginal product of capital
• B)with a larger stock of capital,consumption is encouraged more than investment
• C)the rising capital stock depreciates at a faster rate
• D)the economy settles into a steady state in which saving no longer rises

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