Figure 8.2
-Refer to Figure 8.2.Suppose the economy is originally in steady state at k*₁.All else equal,if the labour force growth rate decreases,
A) break-even investment will shift from (d + n₁) k to (d + n₂) k, and the capital-labour ratio will move from k*₁ to k*₂.
B) break-even investment will shift from (d + n₁) k to (d + n₂) k, and the capital-labour ratio will remain at k*₁.
C) break-even investment will shift from (d + n₂) k to (d + n₁) k, and the capital-labour ratio will move from k*₁ to k*₂.
D) break-even investment will shift from (d + n₂) k to (d + n₁) k, and the capital-labour ratio will remain at k*₁.
Correct Answer:
Verified
Q22: Figure 8.2 Q23: Figure 8.1 Q24: What is depreciation,and what happens to the Q25: If the saving rate increases,break-even investment will Q26: If the capital-labour ratio is below the Unlock this Answer For Free Now! View this answer and more for free by performing one of the following actions Scan the QR code to install the App and get 2 free unlocks Unlock quizzes for free by uploading documents
