Average Growth Rate(2000-2009)of
China -
GDP: 10.9
Population: 0.8
Per Capita GDP: 10.1
Ethiopia -
GDP: 7.5
Population: 2.8
Per Capita GDP: 4.7
How fast does total output(GDP)have to grow in order to raise per capita GDP in
Instructions: Enter your responses to one decimal place.
a.) China? more than ___%
b.) Ethiopia? more than ___%
China .8%
Ethiopia 2.8%
To calculate the average growth rate, we can use the formula:
Average Growth Rate = (Ending Value / Beginning Value) ^ (1 / Number of Years) - 1
a.) For China:
Beginning GDP in 2000: 10.9
Ending GDP in 2009: 10.9 * (1 + 0.109) ^ 9 = 30.3
Number of Years: 9
Average Growth Rate = (30.3 / 10.9) ^ (1/9) - 1 = 0.09 or 9%
To raise the per capita GDP in China, the total output (GDP) needs to grow more than 9% per year.
b.) For Ethiopia:
Beginning GDP in 2000: 7.5
Ending GDP in 2009: 7.5 * (1 + 0.075) ^ 9 = 14.83
Number of Years: 9
Average Growth Rate = (14.83 / 7.5) ^ (1/9) - 1 = 0.0525 or 5.3%
To raise the per capita GDP in Ethiopia, the total output (GDP) needs to grow more than 5.3% per year.
To calculate the average growth rate, we need to use the formula:
Average Growth Rate = (Final Value / Initial Value)^(1/Number of Years) - 1
For China:
Initial GDP in 2000 = 0.8
Final GDP in 2009 = 10.9
Average Growth Rate (GDP) = (10.9 / 0.8)^(1/9) - 1
= 13.625 - 1
= 12.625
Therefore, the average growth rate of GDP in China from 2000 to 2009 is 12.6%.
For Ethiopia:
Initial GDP in 2000 = 2.8
Final GDP in 2009 = 7.5
Average Growth Rate (GDP) = (7.5 / 2.8)^(1/9) - 1
= 1.8125 - 1
= 0.8125
Therefore, the average growth rate of GDP in Ethiopia from 2000 to 2009 is 0.8%.
a.) To calculate how fast total output (GDP) needs to grow in order to raise per capita GDP in China, we need to find the difference between the average growth rate of per capita GDP and the average growth rate of population.
Per Capita GDP growth rate in China = 10.1%
Population growth rate in China = 0.8%
Difference = Per Capita GDP growth rate - Population growth rate
= 10.1% - 0.8%
= 9.3%
So, total output (GDP) needs to grow by more than 9.3% annually in order to raise per capita GDP in China.
b.) Similarly, to calculate how fast total output (GDP) needs to grow in order to raise per capita GDP in Ethiopia, we need to find the difference between the average growth rate of per capita GDP and the average growth rate of population.
Per Capita GDP growth rate in Ethiopia = 4.7%
Population growth rate in Ethiopia = 2.8%
Difference = Per Capita GDP growth rate - Population growth rate
= 4.7% - 2.8%
= 1.9%
So, total output (GDP) needs to grow by more than 1.9% annually in order to raise per capita GDP in Ethiopia.
China 1%
ethiopia 1%