In the Solow Growth Model,if the Level of Investment Is

question 46

Multiple Choice

In the Solow growth model,if the level of investment is less than depreciation at the initial capital-labour ratio,then △k is ________ and the capital-labour ratio ________ toward the steady-state capital-labour ratio.

• A) greater than zero; increases
• B) greater than zero; decreases
• C) less than zero; increases
• D) less than zero; decreases

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