Question

PROBLEMS 1. How would using a ratio scale (rather than a linear scale) affect Figure 1.1? How fast would a country have to be growing in order to double its output in nine years? You should aswer this question using the rule of 72, not a calculator. 3. Suppose that in a particular country, GDP per capita was $1,000 in 1900 and $4,000 in 1948. Using the rule of 72 (not a calculator), approximate the annual growth rate of GDP per capita. 4. Suppose that the entire population of the world consists of four people, divided into two countries of two people each. The following table shows data on their income and nationality. Based on this table, which is the more important source of world inequality: between-country inequality or within-country inequality? Person Nationality Income Alfred Country A Bob Carol Country B 3,000 Doris Country A 4,000 1,000 2.000 Country B 5. In 1900 GDP per capita in Japan (measured in year 2000 dollars) was $1,433. In 2000 it was $23,971. Calculate the growth rate of income per capita in Japan over this period. Now suppose that Japan grows at the same rate for the century following 2000. What will Japanese GDP per capita be in the year 2100?

Answer 1

Rule of 72: doubling time 72/Growth Rate (in %) so td = 9, thus r = 72/9 = 8% Ans Now GDP 1900 = $1000, GDP 1948 = $4000, so let GDP gets doubled in 24 hours from years 1900 to 1924, from $1000 to $2000, Thus by Rule of 72, td = 72/r, so = 72/24 = 3% Thus with growth rate of 3% of GDP per capita, O/P becomes 2000 to 4000$ in next 24 years