Question

The functinsl economics relationship in which the growth rate of gross domestic product (g) depends directly on the net saving rate and inversely on the national capital output ratio (k) that is

Answer 1

Answer:

The Harrod Domar Model suggests that the rate of economic growth depends on two things: Level of Savings (higher savings enable higher investment) Capital-Output Ratio. A lower capital-output ratio means investment is more efficient and the growth rate will be higher.