If the savings rate in an economy is and the incremental output ratio is then the growth rate of the economy will be
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1 mark, −0.33Economics of Growth and DevelopmentHarrod–Domar and Solow growth modelsThe Harrod-Domar modelEasyabout 1 min
UoH 2021 Question 11: Harrod–Domar and Solow growth models
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If the savings rate in an economy is 36% and the incremental output ratio is 4 then the growth rate of the economy will be (A) 10% (B) 9% (C) 5.5% (D) 9.5%
Harrod–Domar and Solow growth models has come up 113 times in 7 exams since 2006.
What this question tests
This question is on The Harrod-Domar model, part of Harrod–Domar and Solow growth models in Economics of Growth and Development.
Growth driven by saving and the capital-output ratio, and why it is knife-edge.
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