Neoclassical growth theory proposes that

Question

Quizplus · Accepted Answer

Neoclassical growth theory, as the name suggests, blends classical economic theories with modern neoclassical theories to explain economic growth. It suggests that real GDP per person grows because of technological change that increases the demand for capital. The theory emphasizes the role of capital in economic growth. As more investments are made in physical and human capital, the economy grows, leading to an increase in real GDP per person. Therefore, option D is the correct answer.

Neoclassical Growth Theory Proposes That