One of the implications of new growth theory is that economic growth arises from
A) financial safety nets for the poor, such as Medicaid.
B) investments in knowledge.
C) reductions in the birth rate.
D) limits on international trade.
Question 2
Which of the following is true of equilibrium?
A) Equilibrium refers to a situation where an economic agent can be made better off without making anyone else worse off.
B) Equilibrium refers to a situation where the government allocates resources among economic agents.
C) Equilibrium refers to a situation where all economic agents are making sub-optimal choices and have an incentive to change behavior.
D) Equilibrium refers to a situation where all economic agents simultaneously optimize after considering each other's actions.
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