Author Question: Which of the following, if implemented in the Solow growth model, would not lead to a steady state? ... (Read 80 times)

formula1 · **on:** Jun 30, 2018

Which of the following, if implemented in the Solow growth model, would not lead to a steady state?

A) A higher population growth rate.
B) Decreasing returns to scale in production.
C) A savings rate that decreases as income increases.
D) A constant marginal product of capital.

Question 2

In a stock market boom ________.

A) autonomous consumption might increase because stock holders might feel richer and consume more
B) autonomous investment might increase because a higher stock value for a firm helps firms raise funds for increased investment
C) the IS curve might shift to the right
D) all of the above
E) none of the above