Russia's real GDP (in U.S. dollars) was \(\$ 2.017\) trillion in 2012 and \(\$ 2.097\) trillion in 2013 Russia's population was 143.2 million in 2012 and 143.5 million in \(2013 .\) Calculate a. The growth rate of real GDP. b. The growth rate of real GDP per person. c. The approximate number of years it will take for real GDP per person in Russia to double if the current growth rate of real GDP is maintained.

Real GDP, short for Real Gross Domestic Product, is a measure of the value of economic output adjusted for price changes (inflation or deflation). It provides a more accurate reflection of an economy's size and how it's growing over time compared to nominal GDP, which isn't adjusted.

By using real GDP, economists can get a clearer picture of whether an economy is truly growing or shrinking. Real GDP is calculated by dividing nominal GDP by the GDP deflator. This adjustment helps to factor out the impact of price level changes. In our exercise, we used real GDP figures for Russia in both 2012 and 2013 to analyze the growth rate accurately.

When calculating growth rates, it’s essential to focus on real GDP because it strips away the noise created by inflation, offering a more precise metric for evaluating the economic performance.

Population growth refers to the change in the number of people in a country or region over a given period. It's a crucial element in understanding economic growth, as it influences the calculation of real GDP per person.

In the exercise, Russia's population increased slightly from 143.2 million in 2012 to 143.5 million in 2013. Though this may seem like a small change, it can significantly impact per capita measures. When population grows, real GDP per person can rise more slowly unless the real GDP grows at a higher rate.

Evaluating economic performance on a per capita basis helps to understand whether the average individual's economic well-being is improving. Thus, the growth rates of both the total GDP and population are interlinked and critical for a comprehensive economic analysis.

The Rule of 70 is a simple way to estimate how long it will take for a variable to double, given its annual growth rate. It's particularly useful in economics to project the future growth of GDP, investments, or any other financial metric.

The formula used in the Rule of 70 is: \[ \text{Doubling Time} = \frac{70}{\text{Growth Rate}} \] In our case, we estimated the time it would take for Russia's real GDP per person to double based on its growth rate of 3.77%. Using the Rule of 70, the calculation was as follows: \[ \text{Doubling Time} = \frac{70}{3.77} \approx 18.56 \text{years} \] This means that if the growth rate remains constant, it will take approximately 18.56 years for the real GDP per person to double. This method is particularly beneficial for long-term economic planning and projections.

The economic growth rate is a measure of how quickly an economy is expanding. It's typically expressed as a percentage increase in real GDP from one period to the next.

In the exercise, we calculated the growth rate of Russia's real GDP by comparing the figures from 2012 and 2013. The formula for the growth rate is: \[ \text{Growth Rate} = \frac{\text{GDP in later year} - \text{GDP in earlier year}}{\text{GDP in earlier year}} \times 100 \] By substituting the given values, the growth rate was found to be 3.97%.

This growth rate is significant because it tells us how fast the economy is growing without the distortions of inflation. It's a critical indicator for policymakers, businesses, and investors as it reflects the overall health and potential of an economy.