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iPad 33% 11:59 AM courses aplia.com Mac OS X Yosemite Essent Aplia: Student Question Course: FMIS 2201 Inform ay15. moodle umn.edu/plu aplia ECON 1022 Section 3 Fall 2015 Misrak Teka Customer Support Sign Out Grades Personalized Reviews Discussion Course Materials Home Economic Growth: Theory and Policy Graded Assignment I Read Chapter 7 l Back to Assignment Due Tuesday 10.27.15 at 06:00 PM Keep the Highest: /2 Attempts: Growth experiences 3. Small differences in the rate of economic growth can lead to large differences in living standards. Consider two countries: Outer Perturbia and Gadzhooks. Currently, real GDP per person (average income is $50,000 in outer Perturbia and $16,667 in Gadzhooks. Suppose you want to project what the real GDP per person will be in each country 100 years from now. The following formula shows how to compute the average income in n years, where g represents the growth rate of real GDP per person (in decimal form hat is, 1.5% is entered as 0.015 Average Income in n Years Current Average Incomex (1+g) Use the growth formula to find the correct amounts to select to fill in the following table. Growth Rate Average Income after 100 Years (Dollars) (Percent) outer Perturbia Gadzhooks 1.5 1.7 4.2 Suppose outer Perturbia is expected to grow at 1.7% for the next 100 years. Which of the following growth rates in Gadzhooks would cause the average income in Gadzhooks to exceed the average income in Outer Perturbia in 100 years? Check all that apply. 1.5% 1.7% 4.0% 4.2% Gradelt Now Save & Continue Copyright Notic Accessibility s of U cy Notice Sec ty No Session 59:44 TimeoutExplanation / Answer
Growth rate(%) Outer Perturbia Gadzhooks
1.5 221602.28 73868.9
1.7 269814.51 89939.96
4 2525247.41 841765.97
4.2 3060144.26 1020068.48
When growth rate of Gadzhooks it will exceed that of Outer Perturbia
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