A decrease in the saving rate will not affect which of the following variables in the long run?
A) Output per worker.
B) The level of investment.
C) The growth rate of output.
D) The total stock of capital in the economy.
E) Capital per worker.

Question

Quizplus · Accepted Answer

The growth rate of output in the long run is determined by factors such as technological progress and growth in the labor force, rather than by the saving rate. The saving rate primarily affects the level of investment and through it, the stock of capital and output per worker, but not the long-run growth rate of output.

A Decrease in the Saving Rate Will Not Affect Which