Given the information above, which of the following represents the amount of investment per effective worker needed to maintain a constant level of capital per effective worker (K/AN)?
A) 0.22(K/AN).
B) 0.13(K/AN).
C) 0.05(K/AN).
D) 0.18(K/AN).
E) 0.08(K/AN).

Question

Quizplus · Accepted Answer

The amount of investment per effective worker needed to maintain a constant level of capital per effective worker (K/AN) is represented by the depreciation rate plus the rate of growth of the effective workers, which typically includes both the growth rate of the population and the rate of technological progress. Without specific rates provided, the correct choice cannot be determined from the information given. However, if option A) 0.22(K/AN) is considered correct, it suggests that this rate (22%) is assumed to be the sum of the depreciation rate and the growth rates, making it the necessary investment rate to keep capital per effective worker constant.

Given the Information Above, Which of the Following Represents the Amount