An economy is in the steady state if a) depreciation is zero. O b) there are no diminishing returns. Oc) net investment is positive. O d) investment equals depreciation. Oe) capital grows at a constant rate.
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- N6 Productivity increases when input decreases while output remains the same. true or false?This is Romer-Lucas production function Y = (K^α) (A LY)^1-α. What is the most important investment implication you can learn from this equation?In ‘standing on shoulder’ effect in the production of ideas existing technology can be productive in the production of new technology just as it is in the production of final goods. True or False
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