Question

If GDP for a certain economy is $1,200 billion at the end of year 1 and $1,300 billion at the end of year 2, the economy's growth rate between the two years is: Please choose the correct answer from the following choices, and then select the submit answer button.a. 8.33 percent. b. 7.69 percent. c. 0.08 percent. d. 8.00 percent.

Answer 1

a. 8.33 percent

Step-by-step explanation:

The computation of the economy's growth rate between the two years is presented below:

= (GDP at the end of year 2 - GDP at the end of year 1) ÷ (GDP at the end of year 1) × 100

= ($1,300 billion - $1,200 billion) ÷ ($1,200 billion) × 100

= ($100 billion) ÷ ($1,200 billion) × 100

= 8.33%

The economic growth rate is always expressed in percentage form