Economic Growth Flashcards
1
Q
Define Economic Growth
A
Is a long-term expansion of a country’s productive potential.
2
Q
How is Economic Growth measured
A
Annual % change in real national output
3
Q
What are the main drivers of Economic Growth
A
- Land / Raw Material - Discovery of new resources
- Labour - Immigration
- Capital / Machinery - spending on physical and human capital
- Technological Progress - Higher efficiencies
- Efficiency of Enterprise -
4
Q
Advantages of Economic Growth
A
- Higher Incomes
- Lower Unemployment
- Lower Govt Borrowing
- Firms make more profit
- Improved public sector
5
Q
Disadvantages of Economic Growth
A
- Inflation
- Boom and Bust Economic Cycles
- Balance of Payments Deficit
- Environmental costs
- Increased inequality
