The Solow growth model shows that the growth rate of real GDP per worker depends on:
A)the saving rate, s
B)government spending, G.
C)the rate of inflation.
D)all of the above.

Question

Quizplus · Accepted Answer

According to the Solow growth model, the growth rate of real GDP per worker depends on the saving rate, s. Government spending and the rate of inflation may impact the economy, but they are not direct factors in the Solow growth model equation. Therefore, the best choice is A, the saving rate.

The Solow Growth Model Shows That the Growth Rate of Real