The Number of Years Required for Real GDP to Double

question 214

Multiple Choice

The number of years required for real GDP to double can be found by

• A) dividing the annual growth rate by 0.07.
• B) multiplying the annual growth rate by 70.
• C) dividing 70 by the annual growth rate.
• D) adding 14 to annual growth rate.

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Definitions:

Real Rate

The interest rate that has been adjusted for inflation, reflecting the true cost of borrowing or the true yield on an investment.

Prices Fall

A situation in the market where the cost of goods or services decreases due to various factors such as supply and demand.

Present Value

The current value of a future sum of money or stream of cash flows given a specified rate of return.

Current Consumption

The portion of income or resources that is spent on goods and services at the present time, as opposed to saving for future consumption.