Final answer:
Myopia would likely have greater marginal returns to capital than Galaxia due to the law of diminishing marginal returns, as investments in lower GDP countries like Myopia yield more significant output increases compared to countries with higher GDP like Galaxia.
Step-by-step explanation:
Based on the law of diminishing marginal returns to capital, Myopia would likely have greater marginal returns to capital than Galaxia. This is because Myopia, with a smaller GDP, is analogous to a low-income country, which tends to have lower levels of human capital and physical capital. Consequently, under the law of diminishing marginal returns, an investment in capital deepening in Myopia should have a larger marginal effect on economic growth than the same investment in Galaxia, where levels of capital are already likely to be higher.
Investments in a country like Myopia can yield significant increases in output, since the additional capital can be utilized more effectively when starting from a lower base. Whereas in Galaxia, which presumably has a higher level of existing capital due to its larger GDP, any additional capital investment will likely result in a smaller increase in output, because of diminishing marginal gains as the quantity of capital continues to increase.