Assume that an economy experiences both positive population growth and technological progress.Once the economy has achieved balanced growth,we know that the capital per effective worker ratio (K / NA)is
A)growing at a rate of δ + gA + gN.
B)growing at a rate of gA + gN.
C)growing at a rate of gN.
D)growing at a rate of gA.
E) none of the above

Question

Quizplus · Accepted Answer

In balanced growth, the capital per effective worker ratio (K / NA) grows at a rate equal to the sum of the rates of technological progress (gA) and population growth (gN), plus the depreciation rate (δ).

Assume That an Economy Experiences Both Positive Population Growth and Technological