In 1950, Per Capita Real GDP in Argentina Was $5,200

question 7

Essay

In 1950, per capita real GDP in Argentina was $5,200 per year and it grew at a constant growth rate of 1.5 percent per year. In Mexico, 1950 per capita real GDP was $3,600, but it grew at a constant rate of 2 percent (both in 2005 prices).What would per capita real GDP be in each country in 61 years (2010)? What about in 91 years (2040)? Will per capita real GDP in Mexico ever surpass that in Argentina? If so, when, approximately? What inference do we make about growth rates from this example?

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