The balanced growth capital-output ratio depends on
A) the balance between the expenditure and output needs of the economy.
B) the balance between the output requirements and the savings made in the economy.
C) the balance between the investment requirements and the investment effort made in the economy.
D) the balance between the labor force requirements and labor force efforts made in the economy.

Question

Quizplus · Accepted Answer

The balanced growth capital-output ratio depends on the balance between the investment requirements (how much investment is needed to achieve a certain level of output) and the investment effort made in the economy (how much investment is actually being made). This balance ensures that the economy grows at a steady rate without leading to excessive inflation or unemployment.

The Balanced Growth Capital-Output Ratio Depends on