Q24 A mathematical approximation called the Rule of 70 tells us that the number of years it will take something that is growing to double insize is approximately equal to the number 70 divided by its percentage rate of growth. For example, if Mexico's real GDP per person isgrowing at 7 percent per year, it will take about 10 years (= 70÷ 7) to double.24Apply the Rule of 70 to solve the following problem.If real GDP per person in Mexico was $12,000 in 2008, while it was $48,000 per person in Canada, and if real GDP per person inMexico grows at a rate of 5 percent per year, how long will it take Mexico's real GDP per person to reach the level that Canada was atin 2008? (Hint: How many times would Mexico's 2008 real GDP per person have to double in order to reach Canada's 2008 real GDPper person?)years

According to the rule 70, Number of years to double the Real GDP = 70/ Annual growth rate

Answered: A mathematical approximation called the…

ENGR.ECONOMIC ANALYSIS

14th Edition

ISBN:9780190931919

Author:NEWNAN

Publisher:NEWNAN

Chapter1: Making Economics Decisions

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