Check Your Understanding

1. Question

   Explain the link between a country’s growth rate, its investment spending as a percent of GDP, and its domestic savings.

2. Question

   Which of the following is the better predictor of a future high long-run growth rate: a high standard of living today or high levels of savings and investment spending? Explain your answer.

3. Question

   Some economists think the best way to help African countries is for wealthier countries to provide more funds for basic infrastructure. Others think this policy will have no long-run effect unless African countries have the financial and political means to maintain this infrastructure. What policies would you suggest?

4. Question

   What is the link between greenhouse gas emissions and growth? What is the expected effect on growth from emissions reduction? Why is international burden sharing of greenhouse gas emissions reduction a contentious problem?