For a developing country that wants to increase its stock of real capital fairly quickly, which of the following is NOT a valid option?
A)implementing policies designed to increase educational levels
B)asking foreign firms for direct investments in the country
C)borrowing funds from the World Bank for real capital investments
D)asking other countries for foreign aid to buy new machines
E)increasing private domestic saving

Question

Quizplus · Accepted Answer

Implementing policies designed to increase educational levels, while beneficial for the long-term development of a country's human capital and potentially leading to higher productivity and innovation, does not directly or quickly increase the stock of real capital. Real capital refers to physical assets like machinery, buildings, and infrastructure, and the other options (B, C, D, E) more directly aim at increasing these assets in the short term.

For a Developing Country That Wants to Increase Its Stock