Problem 3 Since the carly 2000s, the average rate of growth of per capita real G

Question

Problem 3 Since the carly 2000s, the average rate of growth of per capita real GDP in Mozambique has been 4 percent per year, as compared with a growth rate of 8 percent in China. Refer to Table 9-3 on page 193. If a typical resident of each of these nations begins this year with a per capita real GDP of $4,200 per year, about how many more dollars' worth of real GDP per capital would the person in China be earning 10 years from now than the individual in Mozambique? (See page 193.) Please show your work.

Explanation / Answer

Time = 10 years

Real GDP per capita in Mozambique after 10 years = 4200*(1+4%)^10 = 4200*1.48

Real GDP per capita in Mozambique after 10 years = $6216

Real GDP per capita in China after 10 years = 4200*(1+8%)^10 = 4200*2.16

Real GDP per capita in China after 10 years = $9072

So,

More Real GDP per capita in China after 10 years = 9072-6216

More Real GDP per capita in China after 10 years = $2856

Related Questions

Navigate

• Browse (All)
• Browse P
• Subjects

---

---

Integrity-first tutoring: explanations and feedback only — we do not complete graded work. Learn more.