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A numerical example: if the capital:output ratio is 2:1 and investment is 20% of GDP, then when equilibrium output rises by 1%, the desired capital
- A numerical example: if the capital:output ratio is 2:1 and investment is 20% of GDP, then when equilibrium output rises by 1%, the desired capital stock rises by 1%, which is 2% of GDP. This is a 10% increase in investment.
May you explain this numerical example, ONLY ANSWER IF YIU CAN EXPLAIN IT NICELY OTHERSIWE DONWVOTE
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Essentials of Economics
Authors: Bradley Schiller, Karen Gebhardt
10th edition
125923570X, 978-1259235702
