Despite being a high saving economy, capital formation may not result in significant increase in output due to

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CollectorBabu · Accepted Answer

Correct Answer: high capital-output ratio. ● Capital-output ratio (COR) basically indicates the amount of capital required to produce one unit of output. ● If COR is high, despite saving high and generating enough capital, our output may not grow significantly because the COR is high. This may be a result of poor technology or poor management. ● It is also represented by the famous economic model called Harod-Domar Model.

Despite being a high saving economy, capital formation may not result in significant increase in output due to

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