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In Neoclassical Growth Theory, If the Rate of Return on Capital

Question 90

Multiple Choice

In neoclassical growth theory, if the rate of return on capital increases due to a technological advance, then


A) the rate of return on capital will eventually decline.
B) capital per hour of labour will decrease.
C) real GDP per hour of labour will decrease.
D) the rate of return on capital will never decline.
E) population growth will explode.

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