Question

If the secular trend of labor productivity is 3 years percent per year, the number of years that it will take for the standard of living to double will be about

Answer 1

Answer: 23 years.

Step-by-step explanation: The labor productivity grows 3% per year, then the rate of growing is 1 + 0.03 = 1.03.

The equation to caclulate the years is:

`y = y_(0).(1.03)^(t)`

To double:
`y = 2y_(0)`

Substituing:

`2y_(0) = y_(0).(1.03)^(t)\\(1.03)^(t) = 2\\ln1.03^(t) = ln2\\t = (ln2)/(ln1.03)\\ t = 23`

To double the standard of living, it will take 23 years.