(a)
Estimate the value of the growth rate of real GDP.
(a)
Explanation of Solution
The growth rate of real GDP:
The growth rate of real GDP can be calculated using the following formula:
The growth rate of real GDP:
If the 2016 real GDP is 14,461 billion and 2017 real GDP is 14,702 billion, then the value of the growth rate of real GDP can be calculated using the following formula:
Thus, the value of the growth rate of real GDP is 1.7%.
(b)
Estimate the value of the growth rate of real GDP per person.
(b)
Explanation of Solution
Country M’s population growth:
If country M’s population in 2016 is 121 million and 122 million in 2017, then the population growth rate can be calculated using Equation (1) as follows:
Thus, the value of Country M’s population growth rate is 0.8%
Growth rate of real GDP per person:
The growth rate of real GDP per person can be calculated as follows:
Thus, the value of the growth rate of real GDP per person is 0.9%.
(c)
Estimate the approximate number of years to double the real GDP.
(c)
Explanation of Solution
The approximate number of years to double the real GDP can be calculated as follows:
Thus, the approximate number of years to double the real GDP per person is 77.8 years.
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Chapter 23 Solutions
EBK ECONOMICS
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