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24 January, 14:49

Economic growth will A. not be sustained if developing countries stop accumulating capital because of diminishing returns to capital. B. be faster if more capital per hour is used because of increasing returns to capital. C. slow down or stop if more capital per hour is used because of diminishing returns to capital. D. not be affected because the key to economic growth is capital accumulation whether there are diminishing returns or not.

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  1. 24 January, 18:14
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    C. slow down or stop if more capital per hour is used because of diminishing returns to capital.

    Explanation:

    Economic growth can be understood as an increase in an economy's ability to produce goods and services by comparing one period of time with another. It is important to note that this economic metric can be measured in nominal or real terms, the latter being usually adjusted for inflation. Traditionally, economic growth is measured against gross domestic product (GDP) over a period of time, although sometimes alternative metrics are used. In other words, it can be established that economic growth refers to an increase in economic productivity when assessed as a whole in the country.

    It is noteworthy that a growing or more productive economy may show a rise in the production of goods and provide more services than before. In this case, economic growth will slow or stop if more capital per hour is used due to diminishing returns to capital.
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