If Two Economies Are Identical (With the Same Population Growth

question 47

Multiple Choice

If two economies are identical (with the same population growth rates and rates of technological progress) , but one economy has a lower saving rate, then the steady-state level of income per worker in the economy with the lower saving rate:

• A) will be at a lower level than in the steady state of the high-saving economy.
• B) will be at a higher level than in the steady state of the high-saving economy.
• C) will be at the same level as in the steady state of the high-saving economy.
• D) will grow at a slower rate than in the high-saving economy.