1) In a two period model, an increase in lifetime wealth
A) increase current labor supply and decrease current consumption demand.
B) decrease current labor supply and decrease current consumption demand.
C) increase current labor supply and increase current consumption demand.
D) decrease current labor supply and increase current consumption demand.
2) In the Solow growth model, an increase in the savings rate
A) raises steady state per capita output.
B) must reduce per capita consumption.
C) must reduce the standard of living.
D) raises the growth rate in aggregate output.