What is the average annual rate of growth of real output

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Reference no: EM13222933

Nominal Output Real Output
(Billions of current dollars) (Billions of 1996 dollars)

1950 243 1,201
1990 4,330 4,911

(Source: Bureau of Labor Statistics)

In round numbers, real output doubled two times in the 40 years between 1950 and 1990, so it doubled every 20 years. This means that real output grew at a rate z that solves the equation 20 = 70 / z.

Over this 40-year period, what is the average annual rate of growth of real output?

Reference no: EM13222933

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