Suppose a country were to increase its saving rate.In the long run,which of the following would also increase?
A)its income and productivity levels
B)its income growth rate and productivity level
C)its income level and productivity growth rate
D)its income and productivity growth rates

Question

Quizplus · Accepted Answer

Increasing the saving rate leads to more investment in capital, which raises income and productivity levels in the long run. However, it does not permanently increase growth rates, as these are determined by factors like technological progress.

Suppose a Country Were to Increase Its Saving Rate