In the two-sector growth models, the size of the labor force, the proportion of the labor force devoted to research, and the productivity of researchers determine the
A) investment necessary for steady-state growth.
B) steady-state capital stock.
C) growth rate of labor-augmenting technological change.
D) human capital stock.
C
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The capital and financial account balance is equal to
A) the value of exports of U.S. capital goods minus the value of imports of capital goods into the United States. B) exports minus imports. C) foreign assets owned by the United States minus U.S. assets owned by foreigners. D) U.S. investment abroad minus foreign investment in the United States. E) foreign investment in the United States minus U.S. investment abroad.
Starting from long-run equilibrium, a large decrease in government purchases will result in a(n) ________ gap in the short-run and ________ inflation and ________ output in the long-run.
A. expansionary; lower; potential B. expansionary; higher; potential C. recessionary; lower; potential D. recessionary; lower; lower