If d = the depreciation rate,n = the growth rate of the labour force,and k = the capital-labour ratio,which of the following expressions best describes break-even investment?

Question

Quizplus · Accepted Answer

Break-even investment is the amount of investment needed to keep the capital-labour ratio constant, accounting for depreciation and growth in the labour force. The expression (d + n)k captures this by adding the depreciation rate and the growth rate of the labour force, then multiplying by the capital-labour ratio.

If D = the Depreciation Rate,n = the Growth Rate