Answer:
a. $1,042.20
b. $1,545.62
c. $3,360.71
Explanation:
The computations of per capita income are shown below:
a. For growth rate 1%
The per capita income would be
= Current Per capital income × (1 + growth rate)^number of years
= $700 × (1 + 0.01)^40
= $700 × 1.4888637336
= $1,042.20
b. For growth rate 2%
The per capita income would be
= Current Per capital income × (1 + growth rate)^number of years
= $700 × (1 + 0.02)^40
= $700 × 2.2080396636
= $1,545.62
c. For growth rate 4%
The per capita income would be
= Current Per capital income × (1 + growth rate)^number of years
= $700 × (1 + 0.04)^40
= $700 × 4.8010206279
= $3,360.71
