**Problem Statement:***If real GDP grows at an annual rate of 1.19%, then we can expect real GDP to double in approximately how many years? Enter a number rounded to two decimal places.***Guidance for Solution:**To solve this problem, you can use the Rule of 70, a common method for estimating the number of years required to double an investment or a value at a consistent annual growth rate.**Rule of 70 Formula:**\[ \text{Doubling Time (years)} = \frac{70}{\text{Growth Rate (\%)}} \]**Example Calculation:**Given a growth rate of 1.19%, the estimated doubling time of the real GDP would be:\[ \frac{70}{1.19} \approx 58.82 \text{ years} \]Therefore, it would take approximately 58.82 years for the real GDP to double at an annual growth rate of 1.19%.

We will use the rule of 70 to calculate how many years will it take for the GDP to become its…

Answered: If real GDP grows at an annual rate of…

If real GDP grows at an annual rate of 1.19% then we can expect real GDP to double in approximately how many years? Enter a number rounded to two decimal places.

ENGR.ECONOMIC ANALYSIS

14th Edition

ISBN:9780190931919

Author:NEWNAN

Publisher:NEWNAN

Chapter1: Making Economics Decisions

Section: Chapter Questions

Problem 1QTC

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Question

**Problem Statement:**

*If real GDP grows at an annual rate of 1.19%, then we can expect real GDP to double in approximately how many years? Enter a number rounded to two decimal places.*

**Guidance for Solution:**

To solve this problem, you can use the Rule of 70, a common method for estimating the number of years required to double an investment or a value at a consistent annual growth rate.

**Rule of 70 Formula:**

\[ \text{Doubling Time (years)} = \frac{70}{\text{Growth Rate (\%)}} \]

**Example Calculation:**

Given a growth rate of 1.19%, the estimated doubling time of the real GDP would be:

\[ \frac{70}{1.19} \approx 58.82 \text{ years} \]

Therefore, it would take approximately 58.82 years for the real GDP to double at an annual growth rate of 1.19%.

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