Question

A country will roughly double its GDP in twenty years if its annual growth rate is (hint: use the rule of 72):

A. 12 percent
B. 7.5 percent
C. 3.5 percent
D. 2.5 percent

Answer 1

The rule of 72 is used to approximate the number of years it will take for a country's GDP to double based on its annual growth rate. For the given question, the correct answer is A. 12 percent.

Step-by-step explanation:

The rule of 72 is an approximation used to calculate doubling time in economics. It is used to determine the number of years it will take for a country's GDP to double based on its annual growth rate. To use the rule of 72, divide 72 by the annual growth rate. For example, if a country's annual growth rate is 6%, it would take approximately 12 years for its GDP to double (72 / 6 = 12).

To answer the given question, we need to choose the annual growth rate that will result in the country doubling its GDP in twenty years. By dividing 72 by the number of years (20), we can find the required annual growth rate. So, the correct answer is A. 12 percent.