The neoclassical model predicts that nations that are initially poor should have
A) slower growth rates than nations that are rich.
B) faster growth rates than nations that are rich.
C) growth rates equal to those of nations that are rich.
D) negative growth rates.
B
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A problem with the neoclassical growth theory is its
A) prediction that population growth lowers the real wage rate. B) inability to explain persistent differences between countries' GDP growth rates. C) prediction that population growth raises the real wage rate. D) comparison of the economy to a perpetual motion machine.
Once households pay taxes, they have two options with their disposable income: consume or save
Indicate whether the statement is true or false
If there are no reserves, domestic adjustments to payment imbalances under fixed exchange rates require surplus countries to forsake full employment and deficit countries to forsake price stability.
Answer the following statement true (T) or false (F)
The text points out that there is an inverse relationship between the fiscal cost of a bank crisis and real GDP growth. What are some of the reasons that can explain this inverse relationship?
What will be an ideal response?