Rule of 70
The rule of 70 is a useful rule of thumb for quickly calculating the doubling time for something (e.g. population, GDP, internet nodes) that is growing at a
The rule of 70 is a useful rule of thumb for quickly calculating the doubling time for something (e.g. population, GDP, internet nodes) that is growing at a constant rate; it says the doubling time is 70/growth rate. See the video for details and some examples.
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It would have been nice if you could include a quick mathematical basis for this. ie basically the rule of 70 is just because Log (2) = 0.69
Why does it have to be a problem that 1/3 of GDP would be devoted to medical care? If rates continue to be like that, it means that in 35 years, population would also have double income, if 1/3 is then spent in medical care, that means that in the future, 2/3 of a doubled income is spent in everything else, that still is 60% more than 35 years ago. I wouldn't say that is a bad thing for anybody, really.
On the other hand, in a free economy, the amount of resources devoted to a particular expenditure depend on the free choices made by the people. If people are willing to spend 33% of their income in medical care, it is because they value it more than say automobiles or burritos. How can that be a problem?
I think the same issue which was in the practice question ( 17.5 years should be the answer) is in the video.
Med spending rate = 4%p.a , GDP rate = 2%p.a , current share of med spending = 16% , so in 35 years when GDP doubles , med spending will quadruple, i.e 16*4 = 64%. It should quadruple not double.
PS: I have started this course 2 days ago, and I see that most of the comments are a year old. I hope to get responses from our dear faculty. Hope you will watch this space.