When an economy is on the balanced growth path,the growth rate of real GDP per capita is determined by the growth rate of

Question

Quizplus · Accepted Answer

The balanced growth path assumes that all factors of production (capital, labor, and technology) are growing at a steady rate, which means that the growth rate of real GDP per capita is directly determined by the growth rate of total factor productivity. Therefore, choice C is the best answer. Choices A, B, and D are incorrect because they do not fully capture the factors that determine the growth rate of real GDP per capita on the balanced growth path.

When an Economy Is on the Balanced Growth Path,the Growth