Suppose in SA, real GDP/person in 2001 was r₁8 073 and real GDP/person in 2002 was r₁8 635, what was the growth rate of real output per person over this period?
A)2.0 per cent
B)3.1 per cent
C)18.0 per cent
D)18.6 percent
E)5.62 per cent

Question

Quizplus · Accepted Answer

To calculate the growth rate of real output per person, we use the following formula:

Growth rate = [(final value / initial value) - 1] x 100

Plugging in the values we have:

Growth rate = [(r₁8 635 / r₁8 073) - 1] x 100
Growth rate = (1.0309 - 1) x 100
Growth rate = 0.0309 x 100
Growth rate = 3.09%

Therefore, the growth rate of real output per person over this period was 3.1%, which is closest to choice B (3.1%).

Suppose in SA, Real GDP/person in 2001 Was R₁8 073