Econs
Define Economic growth: the increasing capacity of the economy to satisfy the needs and wants of the population
Why is it the most important objective: it determines the future standard of living opportunities of the economy
What is Nominal GDP: the value of output expressed in prices of the day( current prices)
What is Real GDP: tells us what the value of output is if there are no price changes in the economy (constant prices)
What are the Causes of economic growth: technical efficiency, allocative efficiency, dynamic efficiency, land, labour, capital, profit saving and technological progress
Macro economic benefits: economic growth will not increase employment because the growth rate must exceed productivity of workforce, employment will not increase in a declining sector of the economy, increase in aggregate expenditure means imports increase if demand cannot be satisfied domestically
What are the Benefits of economic growth: improved health and education, reduction in poverty, better working conditions, higher employment rate and improved social capital
What are the Costs of economic growth: inequality of income, pollution, loss of renewable resources, loss of land and materialism