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Eduncle posted an MCQ
October 19, 2019 • 17:33 pm 0 points
  • UGC NET
  • Economics

In a hypothetical economy, the rate of growth of nominal GDP is 15% per annum, the annual rate of growth of GDP deflator is 5%. If the population is growing at

In a hypothetical economy, the rate of growth of nominal GDP is 15% per annum, the annual rate of growth of GDP deflator is 5%. If the population is growing at the rate of growth of 2% per annum, what will be the annual rate of growth of per capita real GDP ?

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    Eduncle Best Answer

    (4)
    % annual rate of growth of Real GDP = % annual rate of growth of Nominal GDP
    – % annual growth of GDP Deflator
    = 15% – 5% = 10%.
     
    % annual rate of growth of per capita Real GDP = % annual rate of growth of Real GDP
    – % annual rate of growth of population
    = 10% - 2% = 8%.

    2.68 a.PNG
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