Chapter 9, Problem 7P

To determine

9-7. Per capita real GDP grows at a rate of 3 percent in country F and at a rate of 6 percent in country G. Both begin with equal levels of per capita real GDP. Use Table 9-3 &1 to determine how much higher per capita real GDP will be in country G after 20 years. How much higher will real GDP be in country G after 40 years?

The Real GDP of country G after 40 years.

Concept introduction:

Real GDP per capita is the measurement of total economic output of any country divided by the population of that country. It is adjusted for inflation and is helpful in comparing the standard of living between two or more countries and also between two periods of time of the same country. It has three concepts −

• Gross Domestic Product, which is the value of goods and services that is produced in a country during the year.
• Real GDP, which means the GDP adjusted with inflation or price changes.
• Per capita, which means average per person income