Economics 2.1.1

Economic Growth

Define economic growth.

Economic growth is the increase in the real output of goods and services in an economy over a period of time, usually measured by the percentage change in real Gross Domestic Product (GDP).

What is the distinction between real growth and nominal growth?

real- adjusted to inflation

nominal- current market prices

What are the highest and lowest stats for UK growth

6.5% in 1973

-11% during covid for very short period of time 2020

Why was growth so high/low at this point?

In 1973, post WWII consumer demand was very high and very low unemployment. around 3%

Covid- very high unemployment due to business closure, low well-being, very low consumption and demand