How is harrod-domar model used in planning, Business Economics

How is Harrod-Domar model used in planning?

The Harrod-Domar model is helpful to government for setting target rates for saving required to deliver a specified rate of economic growth.As like an example as suppose k = 4 and target rate of growth is four percent. What is the essential savings ratio? 6 = s/4 which is 16percent.

When the current savings ratio is as around 4 percent in that case cet par, growth will be only one percent, therefore the savings gap to acquire the target 4 percent growth rate is 12 percent.

Posted Date: 8/27/2013 7:41:55 AM | Location : United States

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