Classical growth theory argues that when real GDP per person rises above the subsistence level,
(A)technological change slows down, stagnating the economy
(B)the economy enjoys a period of permanent growth
(C)people don't want to work as much , decreasing labor supply
(D)population growth increases, driving real GDP perperson back to subsistence
- 7 年前最佳解答
(D)population growth increases, driving real GDP perperson back to subsistence level
Definition of Classical Growth Theory
A theory on economic growth that argues that economic growth will end because of an increasing population and limited resources.
Classical Growth Theory economists believed that temporary increases in real GDP per person would cause a population explosion that would consequently decrease real GDP.
Economists behind this theory developed an idea of a subsistence level to model the theory.
They believed that if real GDP rose above this subsistence level of income that it would cause the population to increase and bring real GDP back down to the subsitence level.
It was sort of like a equilibrium level that real GDP would always revert to in this theory.參考資料： marcoeconomics