In the Solow model,if capital is in the steady state,then output:
A)will continue to grow.
B)is also in the steady state.
C)will continue to grow but its rate of growth will slow down.
D)will decline but its rate of growth will be positive.
E)will begin to contract.

Question

Quizplus · Accepted Answer

In the Solow model, in the steady state, the growth rate of output and capital is zero. Therefore, output is also in the steady state, and there is no change in the level of output over time.

In the Solow Model,if Capital Is in the Steady State,then