Suppose two countries have the same growth rates of the capital and labor input stocks. These factors contribute 3 percentage points to their respectivecountries' total output growth rates. Output growth rates are 5% for country 1 and 7% for country 2.

Which of the following is the most likely explanation for the difference in total output growth between these twocountries?

A.Country 1 has a higher level of investment in physical capital.

B.The two countries have differences in the amount of technology or productivity growth they are experiencing.

C.The two countries have differences in the amount of population growth.

D.Country 1 has a lower level of investment in physical capital.

Assume the production functionis:

Y=AK^.3L^.7

What is the productivity growth rate for country1?

%. (Enter your response rounded to two decimalplaces.)

What is the productivity growth rate for country2?

%. (Enter your response rounded to two decimalplaces.)

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Investments in public infrastructure________.

A.

are not subject to diminishing returns

B.

are a misallocation of national savings

C.

typically decline during periods of rapid economic growth

D.

may boost productivity and income

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The result that the growth rate of output per worker is equal to 1.43 gA is________.

A.true of both the Solow model and the Romer model

B.true under the commonlaw legal system only

C.true of the Romer model only

D.true of the Solow model only