Which of the following is always true after an economy reaches a balanced growth equilibrium?
A)the growth rate of output equals the rate of depreciation
B)population growth is zero
C)the growth rate of capital is equal to the growth rate of the effective work force
D)the growth rate of capital is equal to the savings rate
E) none of the above

Question

Quizplus · Accepted Answer

In a balanced growth equilibrium, the growth rate of capital is equal to the growth rate of the effective work force. This ensures that the ratio of capital to effective labor remains constant over time, allowing for sustained economic growth without leading to imbalances between the supply of capital and labor.

Which of the Following Is Always True After an Economy