The Solow growth model predicts that a lower labor force growth rate will lead to
A) a decreased steady state and higher break-even investment.
B) higher productivity and a higher standard of living.
C) a lower saving rate and decreased investment.
D) a higher rate of dilution and lower break-even investment.
B
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Fiscal policy is determined by the Federal Reserve System
Indicate whether the statement is true or false
The division of labor and specialization explain
A) why, when the marginal product of labor increases, so does the average product of labor. B) why the average product of labor falls when firms use more capital or change the layout of their businesses. C) why the marginal product of labor rises as a firm hires its first units of labor. D) why firms may find it profitable to use more workers when the marginal product of labor is negative.