A key assumption of the Solow Growth Model is that: (a) the marginal product of capital diminishes as additional units of capital are added; (b) output per capita declines as a nation’s capital to labor ratio increases; (c) the marginal product of labor tends to rise as additional units of labor are added; (d) capital tends to depreciate at an increasing rate as a nation’s output increases.

A key assumption of the Solow Growth Model is that: (a) the marginal product of capital diminishes as additional units of capital are added; (b) output per capita declines as a nation’s capital to labor ratio increases; (c) the marginal product of labor tends to rise as additional units of labor are added; (d) capital tends to depreciate at an increasing rate as a nation’s output increases.

ENGR.ECONOMIC ANALYSIS

14th Edition

ISBN:9780190931919

Author:NEWNAN

Publisher:NEWNAN

Chapter1: Making Economics Decisions

Section: Chapter Questions

Problem 1QTC

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