Suppose that real GDP starts at 100 and grows at a rate of 10 percent per year for two years. In the third year real GDP would be

Name: Suppose that real GDP starts at 100 and grows at a rate of 10 percent per year for two years. In the third year real GDP would be
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In the first year, a 10 percent growth on 100 would increase real GDP to 110. In the second year, another 10 percent growth on 110 (which is 11) would increase real GDP to 121.

Suppose That Real GDP Starts at 100 and Grows at a Rate