If technical change ceased, then the rate of interest would continue to encourage people to increase their saving.

Question

Quizplus · Accepted Answer

If technical change ceased, it would likely lead to a decrease in productivity and economic growth, leading to lower interest rates as there would be less demand for borrowing. This would not encourage people to increase their saving, but rather to spend more to spur economic growth.

If Technical Change Ceased, Then the Rate of Interest Would