4. Consider the long-run theory of investment, saving, and growth. Which of the following statements concerning national saving is true? An increase in the rate of saving will lead to a short-run reduction in national income, but to higher economic growth in the long run. A country's saving rate is unrelated to its growth rate. An increase in the rate of saving will lead to a reduction in consumption and therefore to both a short-run and a long-run decrease in national income. An increase in the rate of saving will cause an immediate increase in national income, but may cause a drop in national income in the long-run. An increase in the rate of saving will always be offset by a reduction in private investment.
4. Consider the long-run theory of investment, saving, and growth. Which of the following statements concerning national saving is true? An increase in the rate of saving will lead to a short-run reduction in national income, but to higher economic growth in the long run. A country's saving rate is unrelated to its growth rate. An increase in the rate of saving will lead to a reduction in consumption and therefore to both a short-run and a long-run decrease in national income. An increase in the rate of saving will cause an immediate increase in national income, but may cause a drop in national income in the long-run. An increase in the rate of saving will always be offset by a reduction in private investment.
Principles of Economics 2e
2nd Edition
ISBN:9781947172364
Author:Steven A. Greenlaw; David Shapiro
Publisher:Steven A. Greenlaw; David Shapiro
Chapter20: Economic Growth
Section: Chapter Questions
Problem 20RQ: For a high-income economy like the United States, what aggregate production function elements are...
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54. Consider the long-run theory of investment, saving, and growth. Which of the following statements concerning national saving is true?
An increase in the rate of saving will lead to a short-run reduction in
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A country's saving rate is unrelated to its growth rate.
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An increase in the rate of saving will lead to a reduction in consumption and therefore to both a short-run and a long-run decrease in national income.
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An increase in the rate of saving will cause an immediate increase in national income, but may cause a drop in national income in the long-run.
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An increase in the rate of saving will always be offset by a reduction in private investment.
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