The government passes a new initiative to provide a tax credit on research and innovation by firms. What is the impact on the production function, and what is the effect on economic growth in the country?
A) Human capital is enhanced, and economic growth is positively affected.
B) The capital stock decreases, and economic growth is negatively affected.
C) The capital stock increases, and economic growth is positively affected.
D) Technological advancement occurs, and economic growth occurs.
Correct Answer:
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