Multiple Choice
Consider an economy with production function Y = K1/2, an investment rate equal to 0.25, and a depreciation rate of 0.05. If K = 1,000 this period, the capital stock next period will be:
A) equal to 1,000.
B) greater than 1,000.
C) less than 1,000.
D) greater than 1,200.
Correct Answer:
Verified
Correct Answer:
Verified
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