Answer to Question #113375 in Macroeconomics for salma

Question

19. The theory that suggests that our unlimited wants will lead to perpetual economic growth is the
a. classical growth theory.
b. sustained growth theory.
c. old growth theory.
d. new growth theory.
e. Malthusian growth theory.

Answer 1

Economic Theories are concepts derived to explain the happenings within an economy. In macroeconomics, theories explain the Gross Domestic Product in relation to factors such as inflation or unemployment.

The correct choice is (d) new growth theory.

The new growth theory explains how the unlimited wants initiate increased productivity, thus influencing continued economic growth.