An economy in the steady state will have:
A)investment exceeding depreciation.
B)no depreciation.
C)saving equal to consumption.
D)no change in the capital stock.

Question

Quizplus · Accepted Answer

In a steady state economy, the capital stock remains constant. This means that investment is equal to depreciation, so there is no net change in the capital stock over time. Therefore, choices A, B, and C are incorrect.

An Economy in the Steady State Will Have