In the revised version of the Solow growth model the optimal level of the capital stock per worker depends on:
A)the population growth rate.
B)government spending.
C)inflation.
D)all of the above.

Question

Quizplus · Accepted Answer

In the revised Solow growth model, the optimal level of capital stock per worker depends on the population growth rate. This is because as population growth increases, the steady-state capital stock per worker decreases. Therefore, the population growth rate plays a crucial role in determining the optimal level of capital stock per worker. Government spending and inflation may affect economic growth, but they are not directly related to the optimal level of capital stock per worker in the Solow growth model.

In the Revised Version of the Solow Growth Model the Optimal