Question

All of the following actions promote capital deepening EXCEPT

a. raising taxes to pay for building roads.
b. saving less and spending more of one's disposable income.
c. borrowing money from foreign nations to invest in building infrastructure in this country.
d. a low population growth rate at the same time that capital stock expands.

Answer 1

All of the following actions promote capital deepening except "b. saving less and spending more of one's disposable income," since disposable income is "allowed" to be spent.