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The Answer is Capital Deepening and Capital Widening are two concepts related to investment in an economy, particularly in the context of physical capital, which includes machinery, buildings, and infrastructure.

**Capital Deepening:**

Capital deepening refers to an increase in the amount of capital per worker within an economy. This typically means that each worker has more tools, equipment, or technology to work with, which can lead to an increase in productivity. Capital deepening is often achieved through investment in new technologies, better machinery, or more sophisticated equipment. The significance of capital deepening lies in its potential to enhance the efficiency and output of the labor force, leading to economic growth and potentially higher standards of living. It is a key factor in economic development and is often associated with technological advancement and innovation.

**Capital Widening:**

Capital widening, on the other hand, occurs when the stock of capital in an economy increases at the same rate as the labor force. In other words, new investments are made to keep the capital-to-labor ratio constant, even as more workers are employed. This is often necessary in growing economies where the labor force is expanding due to population growth or other factors. The significance of capital widening is that it allows for the accommodation of a larger workforce without reducing the capital available to each worker, thus maintaining productivity levels.

**Relationship between Capital Deepening and Capital Widening:**

The relationship between capital deepening and capital widening is that they are both ways in which an economy can grow its capital stock, but they have different implications for productivity and economic growth. Capital deepening is directly related to increases in productivity per worker, as it involves providing more capital for each worker. This can lead to higher economic output per capita and potentially to economic growth if the increase in productivity outweighs the increase in capital costs.

Capital widening, while necessary to sustain productivity levels in a growing economy, does not by itself lead to higher productivity per worker. It simply maintains the status quo in terms of the capital-to-labor ratio. For an economy to experience sustained growth, capital widening needs to be complemented by capital deepening.

In summary, capital deepening and capital widening are both important for economic development, but they serve different purposes. Capital deepening is crucial for improving productivity and fostering economic growth, while capital widening is necessary to support a growing workforce without diminishing productivity. An optimal investment strategy for a country would likely involve a combination of both, ensuring that the workforce is adequately equipped while also investing in technologies and equipment that enhance worker productivity.

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