In the Solow growth model of an economy with no population growth and no technological progress, the higher the steady capital-per-worker ratio, the higher the steady-state:
A)growth rate of total output.
B)level of total output.
C)growth rate of output per worker.
D)level of output per worker.

Question

Quizplus · Accepted Answer

In the Solow growth model, steady-state output per worker is determined by the level of capital per worker. Therefore, the higher the steady capital-per-worker ratio, the higher the steady-state level of output per worker. There is no relationship between the steady-state capital per worker and the growth rate of total output or output per worker.

In the Solow Growth Model of an Economy with No