Suppose the world demand for iron is about 420,000,000 tons per year and the static reserve is 238. However, the demand for iron is increasing at a rate of 1.8%. What is the exponential reserve for iron?

Question

Quizplus · Accepted Answer

The exponential reserve for iron can be calculated using the formula for the lifetime of a resource under exponential growth: $T = \frac{\ln(1 + r)}{r} \times \frac{S}{C}$, where $T$ is the lifetime of the resource, $r$ is the growth rate of demand (1.8% or 0.018), $S$ is the static reserve (238 billion tons), and $C$ is the current consumption (420 billion tons per year). Plugging in the values, we get $T \approx 93.3$ years, indicating that the exponential reserve for iron is approximately 93.3 years.

Suppose the World Demand for Iron Is About 420,000,000 Tons