4.1.1 growing economies

Question 1

economic growth definition

Answer 1

an increase in a country’s productive capacity

Question 2

emerging economies definition

Answer 2

the economies of developing counties where there is rapid growth, but also significant risk.
-reasons for counties to have emerging economies- because they have a growing population.

Question 3

implications of growth in emerging economies on individuals

Answer 3

> Middle classes have been created in these countries leading to rising disposable incomes- likely to create a demand for more luxury goods in these countries
improved living standards for individuals living in these countries- more people would feel encouraged to live there or could increase demand for other goods
many young people are able and willing to work- output for the country would increase
education and skills of the workforce in these countries would increase- increase in productivity
as skills level increases there is greater need for managers, thus expanding the middle class- more people would be in higher paid jobs and more people with higher income

Question 4

implications of growth in emerging countries for businesses

Answer 4

> there is an increase in demand for consumer goods due to rising incomes- this means that businesses are likely to increase production and output to meet this demand.
new industries and markets are created- new business will be created to meet the demand and fill gaps in the market
businesses are encouraged to offshore- businesses can lower their costs of production significantly.
businesses are encouraged to take risks and innovate- likely to gain a USP and differentiate themselves from competitors