1- If GDP is $25 trillion, in how many years will GDP increase to $100 trillion

Question

1- If GDP is $25 trillion, in how many years will GDP increase to $100 trillion if annual growth is 5 percent?

2- Consider the following data for the country below.

What is the growth rate of real GDP per capita from year 1 to year 2?

3- Suppose a country's real GDP is $15 trillion and that population is 400 million. Suppose that during the next 10 years, real GDP doubles and population grows by half in the country. After 10 years have passed, what will be this country's real GDP per capita?

Year population (millions) real GDP (trillions of $) 1 500 18 2 600 27

Explanation / Answer

If GDP is $25 trillion, in how many years will GDP increase to $100 trillion if annual growth is 5 percent

GDP = 25*(1+0.05)^(n) = 100

1.05^n = 4

log 1.05^n = log 4

nlog1.05 = log 4

n = log4/log1.05 = 25.4134 years

2.

Year population (millions) real GDP (trillions of $) Real GDP per capita Growth Rate = Y2/Y1-1 1 500 18 36000 2 600 27 45000 25%

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