TRUE/FALSE/ OR UNCERTAIN: Explain whether each
point is true, false, or uncertain and use diagrams and equations
to prove so if relevant.
- Based on the Solow growth model, different saving rates explain
varying economic growth rates across countries we observe in the
- A competitive equilibrium of the Solow growth model is achieved
only when the economy reaches the steady state.
- If the consumer’s preferences satisfies the “more is better”
assumption, the indifference curves representing her preferences
are necessarily bowed in toward the origin.
- In the Solow growth model, the aggregate output, Y , always
grows at a constant rate.