Question

From 1990 to 2010, China saw its nominal GDP increase from $1.5 Trillion to $8 Trillion. In 1990 its CPI was 100 and in 2010 its CPI was 195. The population grew from 1.15 billion in 1990 to 1.3 billion in 2010. The total change in total real GDP over this period was approximate? What is the real GDP per capita?

The answer is 1.735 (173.5%) growth in GDP, please provide the steps!

Answer 1

Nominal GDP increase from $1.5 trillion to $8 trillion.

In 1990 CPI =100 and in 2010 ,CPI= 195

Real GDP in 1990 = (1.5 trillion/100)100= $1.5 trillion

Real GDP in 2010= ($8 trillion/195)100= $4.10 trillion

Total change in real GDP over this period = [(4.10-1.5)/1.5]100 = 173.3%

In 1990 : Real GDP per capita = (Real GDP/ Population) = (1.5 trillion/1.15 billion) = 1500 billion/1.5 billion= $1000

In 2010 : Real GDP per capita = (4.10 trillion/ 1.3 billion)= (4100 billion/1.3 billion)= $3153.85