In the Solow model,investment comes from:
A) outside lenders.
B) the government.
C) saving.
D) the capital stock.

Question

Quizplus · Accepted Answer

In the Solow model, investment comes from saving, as a portion of output is saved and invested in new capital goods. Neither outside lenders nor the government are explicitly included in the model as sources of investment, and while investment does increase the capital stock, it is not accurate to say that investment comes from the capital stock itself. Therefore, option C is the best choice.

In the Solow Model,investment Comes From