Question

Real per capita GDP in Taiwan in 1961 was about $500, but it doubled to about $1000.00 by 1981. a. What was the average annual economic growth rate in Taiwan over the 20.00 years from 1961 to 1981? (NOTE: Round this to two places past the decimal point.)

Answer 1

the average annual economic growth rate in Taiwan from 1961 to 1981 was 41.42%

Step-by-step explanation:

Hi, we need to use the following formula.

`FV=PV(1+r)^(t)`

Where:

FV = GDP in 1981 ($1,000)

PV = GDP in 1961 ($500)

r = growth rate

t = years from 1981 to 1961 (20 years)

So, it should look like this:

`1,000=500(1+r)^(20)`

Now, we solve for "r"

`(1,000)/(500) =(1+r)^(20)`

`2=(1+r)^(20)`

`\sqrt[20]{2} -1=r`

`r=0.4142`

So, the growth rate of Taiwan´s GDP is 41.42%

Best of luck.