One country's GDP is currently $600 billion and is growing at 10% per annum. Another country's GDP is $700 billion, while it is growing at 5% per annum. How many years will it take for the GDP of the 1st country to overtake the 2nd?
One country's GDP is currently $600 billion and is growing at 10% per annum. Another country's GDP is $700 billion, while it is growing at 5% per annum. How many years will it take for the GDP of the 1st country to overtake the 2nd?
Solution
Country 1: Current GDP = $600 billion, Growth rate = 10% per year
Country 2: Current GDP = $700 billion, Growth rate = 5% per year
Country 1's GDP after years:
Country 2's GDP after years:
To find when Country 1 overtakes Country 2:
After 3 years:
Country 1:
billion
Country 2:
billion
Country 2 is still ahead.
After 4 years:
Country 1:
billion
Country 2:
billion
Country 1 has overtaken Country 2.
Therefore, it will take 4 years for the GDP of the 1st country to overtake the 2nd.
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