Determine the number of years it will take for the standard of living to double in each country. Instructions: Round your answers to one decimal place. Growth Rates and the Rule of 72Country Real GDP (millions) Growth Rate of Real GDP per Capita (percent) Number of Years for Standard of Living to DoubleCanada $1,597,516 0.2% Madagascar 37,570 1.4 Philippines 807,894 5.3 Sweden 490,282 2.2 United States 18,624,475 0.8
Question
Determine the number of years it will take for the standard of living to double in each country. Instructions: Round your answers to one decimal place. Growth Rates and the Rule of 72Country Real GDP (millions) Growth Rate of Real GDP per Capita (percent) Number of Years for Standard of Living to DoubleCanada $1,597,516 0.2% Madagascar 37,570 1.4 Philippines 807,894 5.3 Sweden 490,282 2.2 United States 18,624,475 0.8
Solution
To determine the number of years it will take for the standard of living to double in each country, we can use the Rule of 72. This rule is a simple way to determine how long an investment will take to double given a fixed annual rate of interest. By dividing 72 by the annual rate of return, investors can get a rough estimate of how many years it will take for the initial investment to duplicate itself.
For Canada: 72 / 0.2 = 360 years
For Madagascar: 72 / 1.4 = 51.4 years
For Philippines: 72 / 5.3 = 13.6 years
For Sweden: 72 / 2.2 = 32.7 years
For United States: 72 / 0.8 = 90 years
So, it will take approximately 360 years for the standard of living to double in Canada, 51.4 years in Madagascar, 13.6 years in the Philippines, 32.7 years in Sweden, and 90 years in the United States.
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