The most unsettling conclusion of the Solow model is the conclusion that once the economy reaches its long-run potential level of income,economic growth simply:
A) declines, leading to what is referred to as a "failed state."
B) matches population growth, with no chance for sustained increases in average income.
C) causes a rapid inflation, leading to an erosion of gains made during the growth period.
D) subsides, as socialism becomes an acceptable form of political economy for the people.
Correct Answer:
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