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What are Harrod-Domar predictions?
The economy is rate of growth, its predictions depends onto:
• Capital formation and accumulation and capital output is the critical to development.
• Specified rate of economic growth = s/k and here k is fixed, govt can find out savings ratio needed for specified growth rate.
• The level and rate of savings is the bases and can be manipulated through government intervention.
There are some examples to government act upon of dip recession. Number of unemployment last long years in companies and take away labour in order to decreased pressure on expen
Percentage Method
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