The self-correcting tendency of the economy means that falling inflation eventually eliminates:

In the context of the neoclassical growth model, which of the following does NOT explain the growth rates of countries which are initially poor?

A) nations which are below their steady-state growth paths will grow more slowly until they reach the steady state B) the rate of return is higher in poor countries C) capital flows from rich countries to poor countries D) the passage of time allows poor countries to adopt the productive techniques of rich countries.

The present discounted value of a future payment becomes smaller when

A) the nominal interest rate decreases. B) the payment is made sooner rather than later. C) the payment itself decreases. D) all of the above E) none of the above