2. Apply the Rule of 70 to the data in Figure 15-3 to determine how long it will take each of the countries listed there (except Zimbabwe) to double its real GDP per capita. Would India’s real GDP per capita exceed that of the United States in the future if growth rates remain as shown in Figure 15-3? Why or why not?
Using the Rule of 70, the amount of time it will take for China to double its real GDP per capita is (70/7.6) = 9 years; India, (70/4.3) = 16 years; Ireland, (70/3.1) = 23 years; the United States, (70/1.7) = 41 years; France, (70/1.2) = 58 years; and Argentina (70/0.88) = 80 years. Since the Rule of 70 can only be applied to a positive growth rate, we cannot apply it to the case of Zimbabwe, which experienced negative growth. If India continues to have a higher growth rate of real GDP per capita than the United States, then India’s real GDP per capita will eventually surpass that of the United States.