Suppose that an economy is initially operating at a point on its PPC. If it then experiences an expansion in its production capacity, but its total spending does not rise as fast as its capacity, the economy will end up:

Which of the following would be directly counted in GDP in 2016?

A) kitchen cabinets built in 1887, extracted from the 1887 home, and installed in a farm house built in 1950 B) kitchen cabinets built in 1887, extracted from the 1887 home, and installed in a brand new country-style home C) kitchen cabinets purchased from Home Depot in 2016 to be installed in a house built in 1997 D) none of the above

In the Solow growth model, the growth rate of real GDP per worker depends on the ________, and in the AK growth model, the growth rate of real GDP per worker depends on the ________

A) rate of depreciation; rate of dilution B) investment growth; rate of population growth C) growth rate of the capital stock; growth rate of the labor force D) rate of labor-augmenting technological change; national saving rate