Which of the following statements, if any, is correct for a nation that is producing only consumer and capital goods?
A. Other things equal, the more consumer goods a nation produces, the greater will be its
future growth rate.
B. Other things equal, the more capital goods a nation produces, the greater will be its future
growth rate.
C. There is no general relationship between the current division of output between consumer
and capital goods and the future growth rate.
D. None of these statements is correct.
Answer: B
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