Other things the same,a country that increases its saving rate increases
A)its future productivity and future real GDP.
B)neither its future productivity nor future real GDP.
C)its future productivity,but not its future real GDP.
D)its future real GDP,but not its future productivity.

Question

Quizplus · Accepted Answer

When a country increases its saving rate, it increases the amount of funds available for investment in physical capital such as factories, infrastructure, and machinery. This, in turn, increases the country's future productivity and future real GDP. With more physical capital, the country can produce more goods and services and increase its economic output. Therefore, choice A is the best answer.

Other Things the Same,a Country That Increases Its Saving Rate