2.5.4 The Impact Of Economic Growth ✅

Question 1

Benefits of econ growth to consumers?

Answer 1

• income rise (firms have less unemployed to chose from thus higher wages).
• unemployment reduction (less spare capacity)
• higher efficiency means that prices may become cheaper or have higher quality. (Depends tho w inflation)

Question 2

Benefits of econ growth to firms?

Answer 2

• investment abilities (higher profits).
• higher confidences (due to rising potential demand).
• opportunity for new businesses/enterprise.

Question 3

Benefits of econ growth to gov?

Answer 3

• tax Revenue rise (higher wages/profits).
• reduction in budget deficit (less unemployed).

Question 4

Benefits of econ growth to current and future standards of living?

Answer 4

• lower poverty level (less unemployed, higher wages, more job availabilities).
• more g/s to enjoy for all not just wealthy.
• improved health (higher housing and food standards).
• higher incomes can afford eco-friendly options.
• higher benefits in developing countries.

Question 5

What are costs of economic growth to consumers?

Answer 5

• rising prices due to inflation (pressure of production factors).
• purchasing power reduction.

Question 6

Costs of econ growth to firms?

Answer 6

• decrease in labour choice thus higher wages.
• menu costs restaurants have to reprint menus due to change prices (inflation).
• markets disappear (dvds) due to product development.

Question 7

Costs of econ growth to gov

Answer 7

• higher expectations for schools and hospitals .

Question 8

Costs of econ growth to living standards now and in the future?

Answer 8

• environmental damages (overuse of finite resources like electricity).
• increased inequalities (exploitation of poor).