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Question: Explain the contribution of capital accumulation in the progress of an economy?
Capital makes the technological progress of the economy possible. Different technologies need different types of capital gods. Therefore when new superior and better technology is discovered its use can be made for production only if that technology is embodies in new capital goods that are if capital goods according to that technology are made. Therefore without capital accumulation not much technical progress can be made. If there is no capital accumulation then the various new inventions or discovers will remain unused for portion. It is therefore clear that capital accumulation promotes technical progress and there by accelerates the economic growth of the country.
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