To determine: The given years’ real GDP per capita as a percentage of its 1960 and 2011 levels.
Concept Introduction:
Explanation of Solution
a. Calculation of real GDP.
Formula to calculate real GDP per capita:
GDP per capita of Argentina:
Year | Real GDP per Capita($) | Percentage of 1960 real GDP per Capita(%) | Percentage of 2011 real GDP per Capita(%) |
1960 | 6,585 | 100 | 48 |
1970 | 8,147 | 124 | 59 |
1980 | 8,938 | 136 | 64 |
1990 | 6,889 | 105 | 50 |
2000 | 9,208 | 140 | 66 |
2011 | 13,882 | 211 | 100 |
GDP per capita of Ghana:
Year | Real GDP per Capita($) | Percentage of 1960 real GDP per Capita(%) | Percentage of 2011 real GDP per Capita(%) |
1960 | 1,557 | 100 | 66 |
1970 | 1,674 | 107 | 71 |
1980 | 1,418 | 91 | 60 |
1990 | 1,296 | 83 | 55 |
2000 | 1,530 | 98 | 65 |
2011 | 2,349 | 150 | 100 |
GDP per capita of South Korea:
Year | Real GDP per Capita($) | Percentage of 1960 real GDP per Capita(%) | Percentage of 2011 real GDP per Capita(%) |
1960 | 1,610 | 100 | 5 |
1970 | 2,607 | 162 | 8 |
1980 | 5,161 | 320 | 17 |
1990 | 11,376 | 706 | 38 |
2000 | 20,016 | 1243 | 67 |
2011 | 2,349 | 1840 | 100 |
GDP per capita of United States:
Year | Real GDP per Capita($) | Percentage of 1960 real GDP per Capita(%) | Percentage of 2011 real GDP per Capita(%) |
1960 | 15,136 | 100 | 66 |
1970 | 20,115 | 133 | 48 |
1980 | 25,221 | 166 | 60 |
1990 | 31,431 | 207 | 74 |
2000 | 39,498 | 260 | 93 |
2011 | 42,244 | 278 | 100 |
Conclusion:
Thus, real GDP is calculated for every country.
b. Comparison of living standard.
- According to the data calculated in part a. it can be said that the highest rise in standard of living from 1960 to 2011 is of South Korea as its real GDP is 1840% in 2011..
- The growth path of Argentina was less consistent compared to Ghana therefore, it can be said that Argentina has moderate standard of living.
- The Real GDP of the U.S in 2011 has increased to 278%, so the U.S also has moderate standard of living.
Conclusion:
Thus, the highest rise in standard of living is in South Korea.
Want to see more full solutions like this?
Chapter 24 Solutions
LaunchPad for Krugman's Economics 4e (Twelve-Month Access)
- Principles of Economics (12th Edition)EconomicsISBN:9780134078779Author:Karl E. Case, Ray C. Fair, Sharon E. OsterPublisher:PEARSONEngineering Economy (17th Edition)EconomicsISBN:9780134870069Author:William G. Sullivan, Elin M. Wicks, C. Patrick KoellingPublisher:PEARSON
- Principles of Economics (MindTap Course List)EconomicsISBN:9781305585126Author:N. Gregory MankiwPublisher:Cengage LearningManagerial Economics: A Problem Solving ApproachEconomicsISBN:9781337106665Author:Luke M. Froeb, Brian T. McCann, Michael R. Ward, Mike ShorPublisher:Cengage LearningManagerial Economics & Business Strategy (Mcgraw-...EconomicsISBN:9781259290619Author:Michael Baye, Jeff PrincePublisher:McGraw-Hill Education