In the second half of the twentieth century, Japan experienced exceptional growth. According to World Bank data, in 1985, Japan’s GDP was $3.67 trillion, and its annual growth rate was 6.33 percent. The GDP in this problem is in constant 2010 dollars.Assuming an exponential annual growth rate of 6.33 percent, calculate Japan’s projected GDP in 2010.In fact, Japan’s 2010 GDP was $5.7 trillion. What could explain any discrepancy between this number and your answer to part (a)?

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Answered: In the second half of the twentieth…

Economics:

10th Edition

ISBN:9781285859460

Author:BOYES, William

Publisher:BOYES, William

Chapter16: Economic Growth

Section: Chapter Questions

Problem 3E

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In the second half of the twentieth century, Japan experienced exceptional growth. According to World Bank data, in 1985, Japan’s GDP was $3.67 trillion, and its annual growth rate was 6.33 percent. The GDP in this problem is in constant 2010 dollars.

Assuming an exponential annual growth rate of 6.33 percent, calculate Japan’s projected GDP in 2010.
In fact, Japan’s 2010 GDP was $5.7 trillion. What could explain any discrepancy between this number and your answer to part (a)?

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