A country's leadership believes that the neoclassical growth theory is correct. The country already has the necessary preconditions for growth, so suggest policy changes the government might enact to help speed economic growth
What will be an ideal response?
The policy changes should encourage technological innovation and capital formation because these are the key engines of growth within the neoclassical growth theory. Hence, the government should encourage research and development, possibly by directly funding research and development. In addition, the government should support policies that increase saving, because an increase in saving will lead to increased investment and hence new capital, some of which will have the new technologies embodied in it.
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An increase in income will lead to an increase in demand for inferior goods.
a. true b. false
Refer to the Article Summary. The article addresses proposed British education reform by way of a completely revised public school system to improve the talent and experience of students
If these reforms lead to a more skilled and better trained public, the British economy would experience A) an increase in human capital. B) an increase in comparable worth. C) a decrease in compensating differentials. D) an increase in the supply of labor.