(1) In the R&D model of endogenous growth, tax incentives to R&D firms would have no
effect on the long run growth rate of the economy. ()
(2) Ideas that are both non-rival and non-exclusive can be easily patented by R&D firms.
()
(3) In the Solow-Swan model of growth, optimising behaviour on the part of households and
firms determines the level of saving in the economy in equilibrium. ( )
(4) In the simple life-cycle model, given an increase in the real return to capital, a rise in
consumption when young is consistent with the income effect dominating the substitution
effect. ()
