Consider a closed economy in the long run. A country with a low national saving rate (as a fraction of real GDP) is likely to have
A) trouble achieving potential real national income in the short run.
B) an AS curve moving continually to the right.
C) either a high or low growth rate depending on the investment schedule.
D) a low growth rate because sustained high investment is not possible with low saving.
E) a high growth rate because aggregate expenditure will be high out of any given income.
Correct Answer:
Verified
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