What are harrod-domar predictions, Business Economics

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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.

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