In the context of economic growth, the Harrod-Domar model emphasises the role of:
A. Technological progress only
B. Labour force growth only
C. Natural resources only
D. Savings and capital-output ratio
Answer: Option D
Solution (By JKSSB Mock Tests)
The Harrod-Domar model states that the growth rate of an economy depends on the savings rate and the capital-output ratio (or inverse of the productivity of capital).
Explanation:
A job-guarantee programme commits the public sector to provide a job at a basic living wage to every person who wants one, thereby eliminating involuntary unemployment and establishing an effective wage floor.
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