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What is the effect of a higher saving rate in the long-run?

a.

It decreases the capital stock.

b.

People must consume less in the future.

c.

It increases productivity.

d.

It leads to higher growth in real GDP.

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Related questions

If a country's saving rate increases, then in the long run: 

A. the growth rate of productivity and grow real GDP per person are both higher.

B. neither growth rate of productivity nor growth rate of real GDP is higher.

C. real GDP per person is higher but productivity is not higher 

D. productivity is higher bt GDP per person is not higher. 

In the long run, a higher saving rate:

A. Does not lead to a higher level of income because of deterioration in labour productivity.

B. Always leads to a higher level of productivity because of increasing returns to scale.

C. Does not always lead to a higher growth rate of output because of decreasing returns to capital.

D. Always leads to a higher growth rate of output because of improvement in the stock of capital.

 

Chapter 12: production, and growth.

5. Which of the following is human capital?

A. a student loan

B. understanding how to use a company's accounting software

C. training videos for new corporate employees

D. All of the above are correct.

6. One of the Ten Principles of Economics in Chapter 1 is that people face tradeoffs. The growth that arises from capital accumulation is not a free lunch. It requires that society

A. conserve resources for future generations.

B. sacrifice consumption of goods and services now in order to enjoy more consumption in the future.

C. recycle resources so that future generations can produce goods and services with the accumulated capital.

D. None of the above is correct.

7. Other things the same, a country that increases its savings rate will have

A. higher future capital and higher future real GDP per person.

B. higher future capital but not higher future real GDP per person.

C. higher future real GDP per person but not higher future capital.

D. neither higher future capital nor higher future real GDP per person.

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