Neco Model Questions Vol1 2019 Economics Question 46
Practice objective / multiple choice question 46 from the 2019 Neco Model Questions Vol1 Economics examination.
Country X's real GDP per capita rose from \(\text{₦}2,500\) to \(\text{₦}3,200\) over a 5‑year period. During the same period the population grew at a constant 2 % per year. (i) Calculate the average annual real GDP growth rate. (ii) The economy has a capital‑output multiplier of 2.5 and a depreciation rate of 5 % per year. The current capital stock is \(\text{₦}150\) billion. The government wishes to raise real GDP per capita to \(\text{₦}4,000\) in the next 4 years. Assuming the accelerator principle and that a constant net investment is made each year, determine the constant annual net investment (in billions of naira) required to meet the target.
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About This Question
This is Neco Model Questions Vol1 2019 Economics Question 46. It is one of the objective questions from the 2019 Neco Model Questions Vol1 Economics examination.
Difficulty level: Hard .
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