Question

Which of the following statements is​ true? A. A higher saving rate allows us to invest in our capital stock and results in economic growth. B. Investment in our capital stock lowers our growth rate and living standards. C. Higher saving rates lower living standards. D. If you want more​ tomorrow, you have to produce more today.

Answer 1

A

Explanation:

Higher savings equals to higher Investments (S = I) where S is savings and I is investment

Output is measured as,

Y = C + I + G

Y is output

C is consumption

I is investment

G is government spending

With higher investment due to higher savings will lead to higher output in the economy and therefore leading to economic growth