Question

a. Brazil's real GDP was 1,180 trillion reais in 2013 and 1,202 trillion reais in 2014. Brazil's population was 198 million in 2013 and 200 million in 2014. Calculate: i. The growth rate of real GDP. ii. The growth rate of real GDP per person. iii. The approximate number of years it takes for real GDP per person in Brazil to double if the 2014 growth rate of real GDP and the population growth rate are maintained. b. The IMF projected the China's real GDP per person will be 20,040 yuan in 2020 and 21, 010 yuan in 2016 and that India's real GDP per person will be 64, 085 rupees in 2020 and 66,840 rupees in 2016. By maintaining their current growth rates, which country will be first to double its standards of livings? C. The Asian Development Bank reported that Myanmar's GDP growth accelerated to 7.5% in 2013 from 7.3% in 2012. Growth was supported by rising investment, improved business confidence, commodity exports, and buoyant tourism. Is this expansion more likely to be a business cycle expansion or economic growth? Explain your answer.

Answer 1

(Question a)

(i)

Growth rate of RGDP = (1,202 / 1,180) - 1 = 1.0186 - 1 = 0.0186 = 1.86%

(ii)

RGDP per person = RGDP / Population

RGDP per person, 2013 = 1,180 / 198 = 5.96

RGDP per person, 2014 = 1,202 / 200 = 6.01

Growth rate in RGDP per person = (6.01 / 5.96) - 1 = 1.0084 - 1 = 0.0084 = 0.84%

(iii)

Let number of years be N. Then

6.01 x (1.0084)N = 2 x 6.01

(1.0084)N = 2

Taking natural log,

N x ln 1.0084 = ln 2

N x 0.0084 = 0.6931

N = 82.52 years

NOTE: As per HOMEWORKLIB POLICY, 1st question is answered. You need to post other questions separately, 1 at a time.