Capital formation, Microeconomics

Assignment Help:

Capital formation:

Growth Economists believe that accumulation of capital is one main source of growth of an economy. Emphasis is given to the accumulation of more capital per head (machines, factories, roads etc.). It should however be noted that mere accumulation of capital will not fuel growth. Unless there are areas of investment unexploited, productive capacity cannot be increased merely by increasing the stock of capital.Capital is also only one of the many productive factors of production. If it is increased relative to other factors of production its marginal efficiency falls (MEC).

Technology:

Expansion of knowledge through science and engineering that leads to new inventions and innovations in production techniques play an important role in growth. Technology can either be developed internally or can be imported from other countries.


Related Discussions:- Capital formation

Accompanying table , The accompanying table represents the price and yearly...

The accompanying table represents the price and yearly quantity sold of ice cream cones on Sidfield Island.   Price of Ice Cream Cones Quantity of Ice Cr

Mrts., why mrts should convex to origin

why mrts should convex to origin

Marginal utility, discuss how economic theory explains the optimum pattern ...

discuss how economic theory explains the optimum pattern of consumption of an individual consumer

Macro economics, At what point is the Fed likely to raise interest rates fo...

At what point is the Fed likely to raise interest rates for the first time? How large are the first couple of hikes likely to be? (hints: conditional on unemployment or gdp growth

Marginal utility, discuss whether marginal utility is a realistic piece of ...

discuss whether marginal utility is a realistic piece of economic analysis in explaining consumer demand

Depreciation tax shield, Depreciation T ax Shield The decr...

Depreciation T ax Shield The decrease in corporate income taxes suitable to the deductibility of depreciation from the firm's taxable earnings.  Although depreciat

Types of external economies generates the output, What types of external ec...

What types of external economies generates the output which reduces the costs of the firms in it? The chief example of external economies provided by marshal are (i) improved

Write Your Message!

Captcha
Free Assignment Quote

Assured A++ Grade

Get guaranteed satisfaction & time on delivery in every assignment order you paid with us! We ensure premium quality solution document along with free turntin report!

All rights reserved! Copyrights ©2019-2020 ExpertsMind IT Educational Pvt Ltd