If an economy is growing at a rate of 3.5% per year, how long will it take the economy to double in size? Choose the closest answer. 70 years 35 years 43 years 20 years 36 years
Question
If an economy is growing at a rate of 3.5% per year, how long will it take the economy to double in size? Choose the closest answer.
70 years
35 years
43 years
20 years
36 years
Solution
To answer this question, we can use the Rule of 70, which is a way to estimate the number of years it takes for an investment or your money to double. The rule of 70 states that you can divide the number 70 by the annual growth rate to get the approximate number of years it will take for the initial amount to double.
In this case, the growth rate is 3.5%. So, we divide 70 by 3.5, which equals 20. Therefore, it will take approximately 20 years for the economy to double in size. So, the closest answer is 20 years.
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