Suppose the economy of an island behaves as the Solow model, version 1.0 (constant population). The production function is Cobb-Douglas (with constant returns to scale) and the exponent on capital is 0.4. Further, the productivity parameter is 50 (A), the depreciation rate is 10% (d), the savings (investment) rate is 20% (s), and the labor force (L) is equal to 50 million (and constant over time).

Compute the 2020 values for consumption per worker (C/L). Recall that households save a constant fraction of their income. Pick the best choice from the options below.

None of the above.

Consumption per worker is between 800 and 900.

Consumption per worker is between 600 and 700.

Consumption per worker is between 700 and 800.