In a Steady-State Economy with Population Growth N and Labor-Augmenting

Multiple Choice

In a steady-state economy with population growth n and labor-augmenting technological progress g, persistent increases in standards of living are possible because the:

A) capital stock grows faster than does the labor force.
B) capital stock grows faster than does the number of effective workers.
C) rate of depreciation constantly decreases.
D) saving rate constantly increases.