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The Rate of Economic Growth Per Capita in Mamoogia from 2006

Question 36

Multiple Choice

The rate of economic growth per capita in Mamoogia from 2006 to 2010 was 3.6% per year, while in Kennan, over the same period it was 7.2%. In 2010, per capita real GDP was $28,900 in Mamoogia and $12,700 in Kennan. Assume the growth rate for each country remains the same. Calculate the percentage difference in their levels of potential output in 2050.


A) Kennan's potential output will be about 32% lower than Mamoogia's potential output.
B) Kennan's potential output will be about 76% lower than Mamoogia's potential output.
C) Kennan's potential output will be about 32% higher than Mamoogia's potential output.
D) Kennan's potential output will be about 76% higher than Mamoogia's potential output.

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