As an economy adjusts to an increase in the saving rate, we would expect output per worker
A) to increase at a constant rate and continue increasing at that rate in the steady state.
B) to increase at a permanently higher rate.
C) to decrease at a permanently higher rate.
D) to return to its original level.
E) none of the above
E
You might also like to view...
Which of the following statements is true?
a. Economic profit equals accounting profit minus implicit costs. b. The short run is any period of time in which there is at least one fixed input. c. A fixed input is any resource for which the quantity cannot change during the period under consideration. d. In the long run there are no fixed costs. e. All of these.
The number of U.S. workers in unions today is:
A. higher than it was in the 1950s. B. about 21 %of all wage and salary workers. C. just under 15 million Americans. D. All of these are true.
The law of diminishing marginal utility helps explain: a. why most individual demand curves are straight lines. b. why most supply curves slope upward
c. why most individual demand curves slope downward. d. why marginal utility falls when total utility falls.
If many people were to suddenly deposit into their checking accounts large sums of cash previously held in their homes and/or wallets, and there were no offsetting actions by the Fed or change in institutional policies, this would
a. decrease the M1 money supply but increase the M2 money supply. b. increase the excess reserves of banks and expand the money supply if these reserves are used to make additional loans. c. reduce the excess reserves of banks and indirectly decrease the M1 money supply. d. reduce the excess reserves of banks and indirectly increase the M1 money supply.