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Shefali is an emerging market economy where labor cost accounts for 35% of total factor cost. The long-term trend of labor growth is 2%. Capital investment has been growing at 1.5% but is expected to grow at 3% in the future. Shefalian economy is expected to experience annual growth of 2.5% in total factor productivity. The potential GDP growth rate for Shefali is closest to: A. 5.15% B. 4.85% C. 7.5% |