The Solow growth model predicts that a country's standard of living can continue to increase in the long run only if

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The Solow growth model emphasizes the role of total factor productivity (TFP) as the primary source of long-term economic growth. TFP measures the efficiency with which capital and labor are used to produce output. Increases in TFP can allow a country to achieve sustained increases in standard of living without necessarily increasing capital or labor inputs. Therefore, sustained increases in TFP are necessary for long-term economic growth. A, B, C, and D are incorrect because sustained increases in these factors alone cannot guarantee long-term economic growth without improvements in TFP.

The Solow Growth Model Predicts That a Country's Standard of Living