Question

Consider the following data for a particular country.

Answer 1

Answer:

Real GDP is inflation adjusted hence there will be no role of inflation. Real GDP per Capita = Real GDP/ Population

Real GDP in year 1 = Real GDP per capita * population

Real GDP in year 1 = $36,000 * 500 million

Real GDP in year 1 = $18 trillion

Growth rate of Real GDP = 7%

herefore Real GDP in year 2 = x - 18/18 = 7/100

Real GDP in year 2 => 100x - 1800 = 126

Real GDP in year 2 => 100x = 126 + 1800

Real GDP in year 2 => 100x = 1926

Real GDP in year 2 => x = 19.26 trillion

So, Real GDP per capita in year 2 = 19.26 trillion /500 million= 38,520