Economics · Economic Growth and Development Theories
Which of the following statements are correct regarding the Demand-Side Vicious Circle? A. Low real income leads to low purchasing power, which subsequently results in a small market size. B. The small size of the domestic market serves as an inducement for entrepreneurs to increase investment. C. Entrepreneurs perceive no profit opportunity in producing for a market where consumers cannot afford to buy. D. Low inducement to invest causes low output and productivity, which perpetually keeps real income low. Choose the most appropriate answer from the options given below:
Verified Solution4 OptionsUpdated: October 2026👁️1 View
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- 1A, B and D Only
- 2A, C and D Only✓
- 3B, C and D Only
- 4A, B and C Only
Correct answer
A, C and D Only
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