Conditional convergence predicts that if two countries have the same steady-state level of output,the poorer country will:
A) grow but never be able to catch up with the richer country.
B) catch up with the richer country because the richer country will not be able to maintain its steady-state output level.
C) catch up with the richer country because it will grow faster than the rich country.
D) not grow at all and will fall further behind the rich country.

Question

Quizplus · Accepted Answer

Conditional convergence theory suggests that if two countries have similar steady-state levels of output, the poorer country will grow at a faster rate than the richer country, allowing it to catch up over time. Thus, option C is the correct answer.

Conditional Convergence Predicts That If Two Countries Have the Same