Economic Growth Flashcards
1
Q
What two ways can economic growth be shown?
A
Increase in AD or increase in SRAS
1
Q
Economic growth
A
An increase in real GDP over time
2
Q
Formula to measure economic growth
A
Calculating the percentage change in Real GDP between two years (Real GDP Year 2 - Real GDP Year 1)/(Real GDP Year 1) x 100
3
Q
Positive effect of economic growth
A
Growth without inflation (shift of SRAS to the right), standards of living improving , government tax revenue, productivity increases leading to an increase in exports
4
Q
Negative effects of economic growth
A
Standards of living worsening (working more hours), equity (growth not shared equally), environmental impact
