Scenario: In 2000, world GDP per capita was $5,500. In 2010, world GDP per capita was $9,500.
-Refer to the scenario above.What was the world average annual growth rate from 2000 to 2010?

Question

Quizplus · Accepted Answer

The average annual growth rate can be calculated using the formula for compound annual growth rate (CAGR), which is $$CAGR = \left(\frac{Final\ Value}{Initial\ Value}\right)^{\frac{1}{Number\ of\ Years}} - 1.$$ Plugging in the given values, we get $$CAGR = \left(\frac{9500}{5500}\right)^{\frac{1}{10}} - 1 \approx 0.056,$$ or 5.6 percent.

Scenario: in 2000, World GDP Per Capita Was $5,500