Final answer:
The growth rate of real GDP from 1980 to 1990 was 39% in the United States, with 43% of that growth representing actual expansion in production once inflation is accounted for. Long-term real GDP growth in the U.S. generally spans between 2% and 4%, but can vary significantly in other countries like Yemen.
Step-by-step explanation:
To determine what was the growth rate of real GDP, measured in percentage terms from 1980 to 1990, we calculate the percentage change using the formula:
- (Real GDP in the later year – Real GDP in the earlier year) / (Real GDP in the earlier year) × 100 = % change in real GDP
Applying this, we find that real GDP grew by (8,225.0 - 5,926.5) / (5,926.5) × 100 = 39%. During this same period, prices also increased, which can affect the real GDP growth rate. Specifically, prices increased by (72.7 - 48.3) / (48.3/100) = 51%, but only 43% of the headline GDP growth rate was in fact real growth, while the remainder was attributed to inflation.
In the long run, in the U.S, real GDP growth has typically been between 2% and 4%. However, significant variability can occur, as seen in other countries, for example, Yemen, which has experienced more erratic economic performance with a real GDP growth rate ranging from 8% to -28% and inflation that has fluctuated markedly as well.