Harrod-Domar

Question 1

Growth rate of production according to the Harrod Domar model

Answer 1

ΔY/Y=s/c - (δ+g)

Question 2

What are the 4 basic Harrod domar equations

Answer 2

S = sY
I=ΔK (- δ if including depreciation)
c = ΔK/ΔY
S=I

Question 3

What are the reasons for low growth rate countries

Answer 3

Use equation : ΔY/Y=s/c - (δ+g)
- Don’t save enough ( s low)
- Aren’t productive enough with investments ( high c)
- high population growth (g)
-High depreciation