If the saving rate increases, a country's growth rate of real GDP per hour of labor ________ and capital per hour of labor ________.

Name: If the saving rate increases, a country's growth rate of real GDP per hour of labor ________ and capital per hour of labor ________.
Brand: Quizplus
Rating: 4.8 (53 reviews)

Question

Quizplus · Accepted Answer

An increase in the saving rate allows more resources to be diverted to investment in capital goods, thus increasing capital per hour of labor. Over time, this leads to higher productivity and growth rate of real GDP per hour of labor.

If the Saving Rate Increases, a Country's Growth Rate of Real