7. Which of the following questions does the Solow model NOT help to explain? a) Why do countries sustain growth in the long run? b) Why are some countries richer than other countries? c) Will a country be richer if the investment rate is higher than another country, all else being equal? d) Why do countries have different growth rates in the same time periods? 8. In the Solow model, the steady-state capital stock is a function of: a) the initial capital stock, productivity, and the saving rate. b) the initial capital stock, productivity, and the depreciation rate. the labor stock and the steady-state level of capital stock. d) productivity, the depreciation rate, the labor stock, and the saving rate. 9. According to the following Figure, if the economy begins with the initial capital stock at K2, the capit stock will and the economy will INVESTMENT, DEPRECIATION . 1 = BY K2 KJ CAPITAL, K a) decrease; grow b) increase; grow stay constant; be in its steady state d) stay constant; grow 10. In the Solow model, if I > dk , the capital stock: a) declines. b) stays the same. grows. d) None of the above answers are correct