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According to the Solow model, how would each of the following affect consumption per worker in the long run (that is, in the steady state)?
According to the Solow model, how would each of the following affect consumption per
worker in the long run (that is, in the steady state)? Explain.
a. The destruction of a portion of the nation's capital stock in a war.
b. A permanent increase in the rate of immigration (which raises the overall population
growth rate).
c. A temporary rise in the saving rate.
d. A permanent increase in the fraction of the population in the labor force (the population
growth rate is unchanged).
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