Suppose per capita real GDP grows by 7% per year. Based on the Rule of 70, approximately how many years will it take for the level of per capita real GDP to double?
A)4.9 years
B)7 years
C)10 years
D)none of the above

Question

Quizplus · Accepted Answer

According to the Rule of 70, the number of years it takes for a variable to double is approximately equal to 70 divided by the annual growth rate of that variable. In this case, 70/7 = 10. Therefore, it will take approximately 10 years for the level of per capita real GDP to double. The closest answer choice is C.

Suppose Per Capita Real GDP Grows by 7% Per Year