(a)
Estimate the value of the growth rate of real
(a)
Explanation of Solution
The growth rate of real GDP:
The growth rate of real GDP can be calculated using the following formula:
Growth rate of real GDP=(Real GDP2017−Real GDP2016Real GDP2016) (1)
The growth rate of real GDP:
If the 2016 real GDP is 14,461 billion and 2017 real GDP is 14,702 billion, then the value of the growth rate of real GDP can be calculated using the following formula:
Growth rate of real GDP=(14,702−14,46114,461)×100=(14,702−14,46114,461)×100=(24114,461)×100=0.0166=1.66
Thus, the value of the growth rate of real GDP is 1.7%.
(b)
Estimate the value of the growth rate of real GDP per person.
(b)
Explanation of Solution
Country M’s population growth:
If country M’s population in 2016 is 121 million and 122 million in 2017, then the population growth rate can be calculated using Equation (1) as follows:
Population growth rate=(Population2017−Population2016Population2016)×100=(122−121121)×100=(1121)×100=0.826
Thus, the value of Country M’s population growth rate is 0.8%
Growth rate of real GDP per person:
The growth rate of real GDP per person can be calculated as follows:
Growth rate of real GDP per person=Growth rate of real GDP−Population growth rate=1.7−0.8=0.9
Thus, the value of the growth rate of real GDP per person is 0.9%.
(c)
Estimate the approximate number of years to double the real GDP.
(c)
Explanation of Solution
The approximate number of years to double the real GDP can be calculated as follows:
Number of years to double=70Real GDP per person=700.9=77.78
Thus, the approximate number of years to double the real GDP per person is 77.8 years.
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