Consider the following list of four economies. Which economy began with a level of real income per person in 1960 that was well below that of Venezuela and grew fast enough to catch up with and surpass Venezuela's real income per person by 2010?Botswana Honduras Malaysia Zambia 1. Economic growth around the worldThe following table reports real income per person for several different economies in the years 1960 and 2010. It also gives each economy's averageannual growth rate during this period. For example, real income per person in Zambia was $1,412 in 1960, and it actually declined to $1,309 by2010. Zambia's average annual growth rate during this period was -0.15%, and it was the poorest economy in the table in the year 2010.The real income-per-person figures are denominated in U.S. dollars with a base year of 2005. The following exercises will help you to understand thedifferent growth experiences of these economies.Real Income per Person in 1960Real Income per Person in 2010Annual Growth RateEconomy(Dollars)(Dollars)(Percent)Austria9,77335,0312.59Venezuela7,3079,7620.58Botswana4689,5156.21Malaysia1,62411,8634.06Honduras1,9323,1460.98Zambia1,4121,309-0.15

The rate of growth in real income per person from 1960 to 2010 is measured as below Rate of growth…

Answered: Botswana Honduras Malaysia Zambia

Business

Economics

Botswana Honduras Malaysia Zambia

Exploring Economics

8th Edition

ISBN:9781544336329

Author:Robert L. Sexton

Publisher:Robert L. Sexton

Chapter20: Economic Growth In The Global Economy

Section: Chapter Questions

Problem 4P

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Suppose that work hours in New Zombie are 200 in year 1 and productivity is $8 per hour worked. What is New Zombie’s real GDP? If work hours increase to 210 in year 2 and productivity rises to $10 per hour, what is New Zombie’s rate of economic growth? Explain why sustained long-term economic growth comes from increases in labor productivity. Why do you think the trend rate of U.S. productivity growth has increased since the earlier 1973–1995 period? The quantity of labor and increases in labor productivity are important sources of economic growth. Between 1953 and 2015, in the US economy the labor force increased from 63 million to 158 million workers. Productivity growth has usually been the more significant factor. To calculate real GDP in a given year you have to multiply hours worked by productivity. Suppose that New Zombie has adopted the framework used by the US Bureau of Labor Statistics to calculate its labor force statistics. Following information is extracted from a…
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