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(10 points) Let us make a conjecture that technology levels are the same across countries so that the differences in GDP per capita are the
(10 points) Let us make a conjecture that technology levels are the same across countries so that the differences in GDP per capita are the result of differences in capital per capita. Let the ratio of capital per worker in Portugal relative to the U.S. value equals 0.12. Assume that production function for the U.S. and Portugal is Cobb-Douglas, constant-returns-to-scale in capital and labor, with the share of capital costs in total income being equal to 35%. What would be the ratio of real wages in Portugal relative to the U.S. value
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