In the Combined Solow-Romer Model, an Exogenous Increase in the Saving

question 21

Multiple Choice

In the combined Solow-Romer model, an exogenous increase in the saving rate:

• A) pushes the economy to a lower per capita output balanced growth path.
• B) pushes the economy to a higher per capita output balanced growth path.
• C) pushes the economy's growth rate of per capita output to infinity.
• D) pushes the economy to a new steady-state level of per capita output.
• E) has no impact on the growth rate or level of per capita output.