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In the Solow Growth Model, If Two Countries Are Otherwise

Question 66

Multiple Choice

In the Solow growth model, if two countries are otherwise identical (with the same production function, same saving rate, same depreciation rate, and same rate of population growth) except that Country Large has a population of 1 billion workers and Country Small has a population of 10 million workers, then the steady-state level of output per worker will be _____ and the steady-state growth rate of output per worker will be _____.


A) the same in both countries; the same in both countries
B) higher in Country Large; higher in Country Large
C) higher in Country Small; higher in Country Small
D) higher in Country Large; higher in Country Small

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