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Ratio of income to capital

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Economics problem

Country A had saving rate of 20% and country B 30%. Capital depreciation rate is 3% and 1.2% in both countries. capital per worker is $6000 and real GDP per worker is $2000 in both countries.

A. Depict the situation of this two countries using solow diagrams and state clearly what the likely differences of growth rate are? Discuss both the savings rate and growth rates. The diagram must depict this differences.

B. What is the ratio of income to capital and saving rates using the solow growth model.

Reference no: EM131079456

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