Based on our understanding of the growth model with no technological progress, which of the following will cause a permanent increase in growth?
A) An increase in the saving rate.
B) An increase in education spending.
C) An increase in capital accumulation.
D) All of the above.
E) None of the above.

Question

Quizplus · Accepted Answer

In the growth model with no technological progress, none of the options (A, B, C) will cause a permanent increase in growth. They may lead to a level effect, increasing the size of the economy, but not its long-term growth rate. Permanent increases in growth typically require technological progress or improvements in efficiency.

Based on Our Understanding of the Growth Model with No