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Draw the Solow model diagram, labeling the steady state k*. On the horizontal axis, pick a value greater than k*for the economy's initial capital stock.
- Draw the Solow model diagram, labeling the steady state k*.
- On the horizontal axis, pick a value greater than k*for the economy's initial capital stock. Label it k1.
- Show what happens to k over time. Does k move toward the steady state oraway from it?
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