2. (a) A country's current GDP is $1,000. Its annual growth rate is expected to average 5%over the next 10 years. What's its expected GDP in 10 years?(b) Explain the Rule of 70. Be sure to include a numerical example in your answer.

Answered: 2. (a) A country's current GDP is…

ENGR.ECONOMIC ANALYSIS

14th Edition

ISBN:9780190931919

Author:NEWNAN

Publisher:NEWNAN

Chapter1: Making Economics Decisions

Section: Chapter Questions

Problem 1QTC

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7. What rate of GDP growth would the government need to meet its goal of doubling the population's living standards in 18 years? Group of answer choices 4 percent 3 percent 2 percent 1 percent
7. Suppose that the economy's production function is Y = √K√LA where K is capital, L is labor, and A is the state of technology. Suppose that the saving rate (s) is equal to 6%, the rate of depreciation of capital (8) is equal to 5%, the number of workers grow at 5% per year and the rate of technological progress is 4%. (a) Find the steady state values of: iv. growth rate of output per worker growth rate of output v. (b) Suppose that the saving rate increases. What is its short-run and the long-run effect on the growth rate of per-capita output?
Givoen the rule of 72, how long would it take for China's economy to doube in size at a constant growth rate of 8% A.) 9 years B.) 10 years C.) 20 years D.) 3 years

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2. (a) A country's current GDP is $1,000. Its annual growth rate is expected to average 5% over the next 10 years. What's its expected GDP in 10 years? (b) Explain the Rule of 70. Be sure to include a numerical example in your answer.