Consider country A with $50,000 income per capita and low productivity but growing at 0.5% per year. Country B, on the other hand, has $10,000 income per capita and high productivity and growing at 1.5% per year. What are the prospects for standard of living in both countries? Explain. Answer:

Suppose country A has a GDP of 4000 with a population size of 200; country B has GDP of 9000 with a population size of 300. Which country is more likely to have a better living standard?

Assume that a leader country has real GDP per capita of $40,000, whereas a follower country has real GDP per capita of $20,000. Next suppose that the growth of real GDP per capita falls to zero percent in the leader country and rises to 2 percent in the follower country. If these rates continue for long periods of time, how many years will it take for the follower country to catch up to the living standard of the leader country?

The productivity growth rates of poorer countries tend to be _____ than those of richer countries. Higher Lower increasing slower decreasing faster

Country A’s real GDP per capita is $4,000 today, but it is constantly growing at 5%per year. Country B’s current real GDP per capita is $16,000, but it is constantly growing at 2% per year. Willthe standard-of-living in Country A ever catch-up with or overtake Country B? If so, when would it happen?Provide your analysis