1.3. The accompanying table provides approximate statistics on per capita income levels and growth rates for regions defined by income levels. According to the Rule of 70, the high-income countries are projected to double their per capita GDP in approximately 37 years, in 2042. Throughout this question, assume constant growth rates for each of the regions that are fixed at their average value between 2000 and 2005.

a. Calculate the ratio of per capita GDP in 2005 of the following:
i. Middle-income to high-income countries ii. Low-income to high-income countries iii. Low-income to middle-income countries

b. Calculate the number of years it will take the low-income and middle-income countries to double their per capita GDP.

c. Calculate the per capita GDP of each of the regions in 2042. (Hint: How many times does their per capita GDP double in 37 years?)

d. Repeat part a with the projected per capita GDP in 2042.

e. Compare your answers to parts a and

d. Comment on the change in economic inequality between the regions.

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Region High-income countries Middle-income countries Low-income countries Source: World Bank. GDP per capita (2005) Average GDP per capita growth (2000-2005) $28,612 1.9% 2,196 5.7 494 3.6