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Using the Harrod-Domar Growth Model,suppose One Economy Has to Maintain

Question 10

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Using the Harrod-Domar growth model,suppose one economy has to maintain a growth rate of GDP of 10 percent per year in order to avoid a decline in the average standard of living.Assume in this economy,the capital-output ratio v is 3 and the depreciation rate d is 5%,what is the required saving rate?


A) 5 percent.
B) 15 percent.
C) 30 percent.
D) 45 percent.

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