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CFA Level 2
Economics

Understanding Capital Deepening

Very Easy Economic Growth And Development Capital Deepening

Capital deepening occurs when an economy increases its capital stock per worker, leading to greater productivity and economic growth. This process involves investing in more physical capital, such as machinery and equipment, relative to the labor force. This question focuses on understanding what capital deepening means in the context of economic growth.

Which of the following statements best describes capital deepening?

Hint

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