Two Countries, Baltonia and Polonia, Have Aggregate Production Functions in the Form

Multiple Choice

Two countries, Baltonia and Polonia, have aggregate production functions in the form Y = A × K^1/3 × H^2/3, where Y denotes total output, A denotes the level of technology, K denotes the physical capital stock, and H denotes the number of efficiency units of production. Both countries have the same number of efficiency units of labor and use the same technology. However, Baltonia has a smaller physical capital stock than Polonia does. Which of the following is likely to be true in this case?

A) The GDP of Baltonia is higher than that of Polonia.
B) The GDP of Baltonia is lower than that of Polonia.
C) The Human Development Index of Baltonia is higher than that of Polonia.
D) The poverty rate in Baltonia is lower than that in Polonia.