Question 2 of 7> Attempt 2 Long-Run Economic Growth: End of Chapter Problems 2.

Question

Question 2 of 7> Attempt 2 Long-Run Economic Growth: End of Chapter Problems 2. The accompanying table shows the average annual growth rate in real GDP per capita for Argentina, Ghana, and South Korea using data from World Bank, World Development Indicators, for the past few decades. b. Suppose that the average annual growth rate that each country achieved over the period 2005-2015 continues indefinitely into the future. Starting from 2015, use the Rule of 70 to calculate, where possible, the year in which a country will have doubled its real GDP per capita. Round the year 1995- to nearest whole number Average Annual growth rate of (millions per year) Years Argentina Ghana South Korea 1965-1975| 1.92% |-1.13% | 8.29% 1975-1985 -1.422.297.08 8.06 1.14 2.164.28 3.02 1985-1995 154 1.70 ound the year 2005-2015 3.11 445 302 Argentina doubles its GDP by Ghana doubles its GDP by V Scroll South Korea doubles its GDP by about| career.. privacypolicy!termi orusel contact us l help

Explanation / Answer

Using Rule of 70, Doubling period = 70 / Annual growth rate

(i) Doubling period, Argentina = 70 / 3.11 = 22.5 years ~ 23 years

Argentina doubles its GDP by 2038 (= 2015 + 23).

(ii) Doubling period, Ghana = 70 / 4.45 = 15.7 years ~ 16 years

Ghana doubles its GDP by 2031 (= 2015 + 16).

(iii) Doubling period, South Korea = 70 / 3.02 = 23.2 years ~ 23 years

South Korea doubles its GDP by 2038 (= 2015 + 23).

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