Question

If GDP is $20 trillion, how many years will it take for GDP to increase to $80 trillion if annual growth is 5 percent?

a) 10 years
b) 15 years
c) 20 years
d) 25 years

Answer 1

To calculate the number of years it will take for GDP to increase from $20 trillion to $80 trillion at a 5% annual growth rate, we can use the formula GDP = Initial GDP * (1 + Annual Growth Rate)^Number of Years.

By solving this equation, we find that it will take approximately 18 years for GDP to increase to $80 trillion.

Step-by-step explanation:

To calculate how many years it will take for the GDP to increase from $20 trillion to $80 trillion with an annual growth rate of 5%, we can use the formula:

GDP = Initial GDP * (1 + Annual Growth Rate)Number of Years

Plugging in the given values:

$80 trillion = $20 trillion * (1 + 0.05)Number of Years

Simplifying the equation:

(1 + 0.05)Number of Years = 4

Using logarithms or trial-and-error, we find that the value of Number of Years is approximately 17.5. Since we have to consider whole number years, the answer is approximately 18 years.