Question: 17. Please attach w solution Consider the following statements regarding the Solow model: 1. If the saving rate of the economy decreases, consumption will fall

17. Please attach w solution

Consider the following statements regarding the Solow model: 1. If the saving rate of the economy decreases, consumption will fall immediately and over time until it reaches the new steady state. 2. An increase in the saving rate of the economy will always increase investment. O Only statement 2. is true O Only statement 1. is true Both statements are false Both statements are true

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