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Consider the Solow growth model. The production function is given by Y = K^αN^1−α, with α...

Consider the Solow growth model. The production function is given by Y = K^αN^1−α, with α = 1/3. There are two countries: X and Y. Country X has depreciation rate δ = 0.05, population growth n = 0.03, and savings rate s = 0.24. Country X starts with initial capital per worker k0 = 1

Country Y has depreciation rate δ = 0.08, population growth n = 0.02, and savings rate s = 0.3. Country Y starts with capital per worker k0 = 1.5.
(a) Which country has higher output per worker in the short run? in the long run? Explain your answers.

(b) Which country has higher growth of output per worker in the short run? in the long run? Explain your answers.

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