1. According to the Solow growth model, if a country is below its steady state level of output, we would expect that next year it would be:
a. At a higher level of output, and closer to the steady state.
b. At a lower level of output, spiraling further away from the steady state.
c. At the same level of output as before.
d. Not enough information to tell.
2. According to the Solow growth model, if a country is above its steady state level of output, we would expect that next year it would be:
a. At a lower level of output, and closer to the steady state.
b. At a higher level of output, spiraling further away from the steady state.
c. At the same level of output as before.
d. Not enough information to tell.